Holes in pro-HST argument

Tom Thomson of the Nelson and District Chamber of Commerce wrote: “Try and keep politics out of the [HST referendum] question, and look at the issue on a factual basis.” However, the few facts which Mr. Thomson provides conflict with the “Indepdendent Panel’s Report,” dated May 4, 2011 which also frequently states, “It’s best to state the fact[s].”

Re: “Take politics out of HST discussion,” July 22

Tom Thomson of the Nelson and District Chamber of Commerce wrote: “Try and keep politics out of the [HST referendum] question, and look at the issue on a factual basis.”  However, the few facts which Mr. Thomson provides conflict with the “Indepdendent Panel’s Report,” dated May 4, 2011 which also frequently states, “It’s best to state the fact[s].”

Unfortunately, the reality is that this issue has become complicated beyond belief, and I can pull “facts” from both these sources (and several others) which conflict with each other.

Thomson states that after the reduction of HST to 10 per cent (which is not mentioned anywhere in the high-tech Independent Panel Report) “economists estimate [not factually assert] the average BC family will be paying $120 less per year than under the PST/GST.” However, the panel unequivocally writes the following: “It’s best to state the fact… British Columbian families pay an average of $350 more every year on routine expenditures under the HST… At the cash register, 17 per cent of your spending has an extra seven per cent sales tax.” And take note that “The (additional) $350 sales tax per family does not include the HST you now pay when you buy a newly built home…”

While various categories of goods will remain taxed at the same rate under HST as they were under PST/GST, the following items (only a few of many) will be taxed at a higher rate under HST: restaurant meals, movies, magazines, bicycles (there’s an environmentally sound tax!), professional services (does that mean lawyers, dentists, etc.?), and most appalling of all, newly built homes. However, we can rest assured that if our newly built home sells for less than $525,000, we only have to pay the exorbitant tax amount under the previous PST/GST. But if your purchase price exceeds $525,000 (and in Metro Vancouver, the median single family home price is $685,000), then those lucky purchasers only have to pay $8,000 more sales tax than under the PST/GST.

What I find most staggering is that the Independent Panel’s Report cite an entire page of sources which they allegedly read and an entire page of submissions that were received by the panel. Yet not only once, but four times, this esteemed panel could not commit as to whether BC would have to pay back the $1.6 billion Ottawa gave to BC to ease the transition to HST.

Despite the fact that “Our panel acknowledges it’s hard to put concrete numbers to…future benefits,” this panel nonetheless goes on to do exactly that. Some examples:  produce great goods and services for exports; “create an additional 24,000 better-paying jobs” etc., and that the HST “will provide extra revenue to fund hospitals, schools, roads, and other important services you rely on.”

May I make a very simple observation: of course the HST as outlined in the panel report and Tom Thomson’s article will contribute to an improvement in part of our economy. Because as long as each individual keeps buying, we will be paying an additional $350 per year to the provincial coffers. Anyone wanting to buy a new home (in a province where it is incredibly hard to afford one as it is) will drop money into the “improve BC economy coffer.” Why will business fare so well? Because it won’t be paying as much HST but will be reaping greater benfits.

Has anyone ever considered the option of cutting back spending, say, as a small example, to the IHA which costs millions of dollars to sustain itself while it gouges gigantic holes out of the health care systems in rural BC?

T. Morrison

Nelson

 

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