HST debate heats up as vote nears

Does this trucker get equipment input credits from the HST? Yes. Does he work for a 'big business'? No.

Does this trucker get equipment input credits from the HST? Yes. Does he work for a 'big business'? No.

VICTORIA – My feedback on the harmonized sales tax debate is running hotter as taxpayers await Premier Christy Clark’s “bold” changes to the tax, due to be revealed any day.

In response to several angry readers, I will restate what I had hoped was obvious by now. All but the poorest consumers (myself included) are paying more tax under the HST than they were under the old provincial sales tax. The richest pay by far the most.

The “embedded” PST has been removed from many products, but evidence isn’t yet clear that this is being passed on to consumers, as economists predict. What is clear is that businesses are benefiting. What is still in dispute is what businesses are helped most.

Doug Donaldson, the NDP MLA for Stikine, objected to my statement last week that he was wrong about the HST beneficiaries being “Liberal donor corporations.” So again I will state the obvious, that forest, mining and other resource companies donate to the B.C. Liberals. (The NDP is on record as wanting to increase corporate income and capital taxes.)

Donaldson goes wrong when he specifies “corporations” rather than small business. Consider the forest industry.

Over the past 20 years the entire B.C. industry contracted out its harvesting operations, based on the well-tested principle that independent contractors are more efficient than inflexible, strike-prone major forest operators. That has been a painful process, not just economically but in terms of worker safety. But it’s exactly the kind of global-market shift that is being imposed on B.C.

As mentioned last week, you may not like that, but you shouldn’t believe those who try to pretend it’s not happening. And those big “corporations” had their major machinery and equipment exempted from sales tax long before the HST. It’s the small contractors who are now getting the benefit.

NDP finance critic Bruce Ralston notes that anyone can incorporate for tax purposes. It’s common for doctors, dentists and lawyers such as Ralston. But is it practical to expect the owner-operator of a logging truck to do that?

The independent truck drivers I’ve met are more concerned about paying their next fuel bill than hiring a lawyer to incorporate them. Increasingly it is immigrants who drive trucks, out-working the resident population to get ahead as immigrants have always had to do.

Speaking of immigrants, the situation in Vancouver real estate is worth noting. One of the things HST was supposed to severely depress was high-end new housing, now subject to the seven-per-cent provincial portion of HST once the prices exceeds $525,000.

What has happened? Offshore buyers are pushing costs out of the reach of B.C. residents who aspire to an ocean view. In many cases these are “satellite families,” taking advantage of our clean, stable, safe jurisdiction on the Pacific Rim. Mum may drive the kids to private school in a Range Rover, but the family reports little or no Canadian income. The only way these residents will pay a share is through consumption taxes.

I have also argued that migration of retirees will dominate B.C.’s population growth in the coming years. This is another group that reports less income but has significant consumption.

A recent BC Stats study shows that I overstated the impact of retirees. Since 1961, only seven per cent of migrants to B.C. have been 65 or older.

Younger people are coming here to work, and increasingly they will be self-employed or in small business.

The NDP supports lowering small business income tax to zero. They should also support the HST.

Tom Fletcher is legislative reporter and columnist for Black Press and BCLocalnews.com

twitter.com/tomfletcherbc

Just Posted

A person receives a COVID-19 vaccine at a vaccination clinic run by Vancouver Coastal Health, in Richmond, B.C., Saturday, April 10, 2021. Northern Health confirmed it has the lowest vaccination rates amongst the province’s five regional health authorities. (THE CANADIAN PRESS/Jonathan Hayward)
Vaccination rates in Vanderhoof, Fraser Lake, Fort St James well below provincial average

COVID-19 immunization clinics for youth 12+ coming up in Fort St. James

Steve McAdam (left) is studying substrate conditions in the Nechako River and how they impact sturgeon eggs. The work will help design habitat restoration measures, said McAdam. (Rebecca Dyok photo)
Sturgeon egg studies to help inform future habitat restoration

“It’s an interesting, challenging issue,” says Steve McAdam

Saik’uz First Nation Coun. Jasmine Thomas and Chief Priscilla Mueller speak about the need for addiction treatment facility near Vanderhoof, March 2021. (Aman Parhar/Omineca Express)
Vanderhoof addiction treatment centre tries again with ministry support

Agriculture minister insists she is not interfering in land commission

At an outdoor drive-in convocation ceremony, Mount Royal University bestows an honorary Doctor of Laws on Blackfoot Elder and residential school survivor Clarence Wolfleg in Calgary on Tuesday, June 8, 2021. THE CANADIAN PRESS/Jeff McIntosh
‘You didn’t get the best of me’: Residential school survivor gets honorary doctorate

Clarence Wolfleg receives honorary doctorate from Mount Royal University, the highest honour the school gives out

Two-year-old Ivy McLeod laughs while playing with Lucky the puppy outside their Chilliwack home on Thursday, June 10, 2021. (Jenna Hauck/ Chilliwack Progress)
VIDEO: B.C. family finds ‘perfect’ puppy with limb difference for 2-year-old Ivy

Ivy has special bond with Lucky the puppy who was also born with limb difference

A million-dollar ticket was sold to an individual in Vernon from the Lotto Max draw Friday, June 11, 2021. (Photo courtesy of BCLC)
Lottery ticket worth $1 million sold in Vernon

One lucky individual holds one of 20 tickets worth $1 million from Friday’s Lotto Max draw

“65 years, I’ve carried the stories in my mind and live it every day,” says Jack Kruger. (Athena Bonneau)
‘Maybe this time they will listen’: Survivor shares stories from B.C. residential school

Jack Kruger, living in Syilx territory, wasn’t surprised by news of 215 children’s remains found on the grounds of the former Kamloops Indian Residential School

A logging truck carries its load down the Elaho Valley near in Squamish, B.C. in this file photo. THE CANADIAN PRESS/Chuck Stoody
Squamish Nation calls for old-growth logging moratorium in its territory

The nation says 44% of old-growth forests in its 6,900-square kilometre territory are protected while the rest remain at risk

Flowers and cards are left at a makeshift memorial at a monument outside the former Kamloops Indian Residential School to honour the 215 children whose remains are believed to have been discovered buried near the city in Kamloops, B.C., on Monday, May 31, 2021. THE CANADIAN PRESS/Darryl Dyck
‘Pick a Sunday:’ Indigenous leaders ask Catholics to stay home, push for apology

Indigenous leaders are calling on Catholics to stand in solidarity with residential school survivors by not attending church services

“They will never be forgotten, every child matters,” says Sioux Valley Chief Jennifer Bone in a video statement June 1. (Screen grab)
104 ‘potential graves’ detected at site of former residential school in Manitoba

Sioux Valley Dakota Nation working to identify, repatriate students buried near former Brandon residential school

The Queen Victoria statue at the B.C. legislature was splattered with what looks like red paint on Friday. (Nicole Crescenzi/News Staff)
Queen Victoria statue at B.C. legislature vandalized Friday

Statue splattered with red paint by old growth forest proponents

Most Read