Thanks for writing this, Will. My wife and I were operating a very small seasonal retail business in the Cariboo when the Liberals raised the PST from 7 to 7.5%. For people like us who didn't have the luxury of a cash register, and who made out sales receipts by hand, our productivity dropped & our frustration increased, because suddenly we had to do *two* calculations instead of one, i.e. work out 7% of the sale for the GST, and then 7.5% for the PST. (Before we just calculated the 7% once and repeated it.) Try doing this at a Christmas craft fair with a lineup of customers ;-) It pissed me off as much as the GST always has with all its arcane rules, formulas, and regressiveness, introduced thanks to Free Trade with the US. I remember working in a bakery when that came in, and how stupid it was to charge someone GST on a raisin scone, but not on a cheese scone. Or on 5 raisin scones bagged together, but not on a half dozen bag (which discriminates against single people who aren't buying in bulk). There was GST on water with bubbles, but not on water without bubbles. GST on sausage rolls if they were hot, but not if they were frozen. What pinheads thought this up?! Aaag. CCPA uncovered the other aspect of the BC Liberal tax shift, which was the disproportionate geographical distribution of the tax cuts. It was no surprise to those of us living in the boonies that most of the gains were in the lower mainland. The report is somewhere on their site at http://www.policyalternatives.ca/ "Behind Closed Doors: How the Rich Won Control of Canada's Tax System" by Linda McQuaig is still worth reading to understand how our tax system has evolved. I try to catch all her columns that appear on the rabble.ca site.

[OFFENSIVE COMMENT REMOVED.

[OFFENSIVE COMMENT REMOVED. -MODERATOR.]

Adam, try reading what Bill is trying to say about the situation instead of just spewing your knee-jear reaction. Did Bill say that he was voting NDP? The problem with BC Liberal supporter like yourself is that you cannot listen to what anyone is saying.

poiuy--It was Jesus who said the poor are always with you. He also said "Feed my sheep and lanbs." Bill--I tried to find Linda's article. Can you give a more precise website?

Nerd: I havn't met many smart people who wake up in the morning and quote the CCPA.

Here's a thought about MSP Premiums that should drive some entrepreneurs up the wall sideways but still benefit them. Why not make the the MSP premium an ad valorem tax based on income? If made an employment tax, the companies get the tax benefit write off against their income. It is then not a taxable benefit for the employee/worker if the company pays. It seems like a win-win situation especially if there is no upward limit on the income that it is applied to. Based on our household income a 2% ad valorem tax would take in roughly the same amount is our current quarterly premiums. Yes, we do operate our own business and certainly we could use that write down of our business income. Seems to me this would be a preferable way of doing things. Any other thoughts. And yes, I would like to see the eventual elimination of the PST.

I too would also like to see the eventual elimination of the PST in BC. However, I would have much rather seen the elimination of the increased MSP premiums and the inclusion of eye doctor examinations into our medical services again before I saw any relief from the PST. The removal of the PST first falls into the "user-pay" philosophy of the BC Liberals very nicely. It is quite obvious who they are catering to, and it is not the family with two kids who make between $40,000 to $60,000 a year.

Chris, with MSP being a payroll tax rather than a premium it effectively eliminates the cost from families and makes it an employment tax against employers who would then be able to use to write down their income thereby ensuring universal coverage. The side benefit as discovered in Ontario is that companies can use the payroll tax to reduce their federal tax payable which is pretty much why the feds' do not like. There are only a couple of provinces left that actually have a premium base. I absolutely agree that eye examinations need to be covered.

hey adam this from the guy who quotes the national post, you are a liberal!

The one constant I have noticed about the few liberal supporting people I know is their greed and lack of intelligence, they wear blinders and keep spewing the same old rhetoric! Another constant I am noticing about the liberal supporters and right wingers in general on these sites is that when things don't go their way they run away, is this charactistic common with the kind of people who support gordo and harper! I'm ok jack just gimmie gimmie gimmie and to hell with the next generation kinda folks!

MSP eh? After moving to this province I was shocked to find out I would have to pay MSP. What a load of bullshit. I wish the government would increase sale's tax just so that I could eliminate another bill in my life.

Vick, are you stalking me on here ? Cause that would be great. I won't sterotype like Vick and say all left wingers are like somthing. Cause that would be ignorant. However, Vick has the worst case of "It's everyone's fault but mine" syndrome I have ever seen.

Folks, you can't reason with people like Adam any more than you can reason with Gordo. Idealogically driven, they are blind and deaf to any other approach than their own. You can, however, deliver a message to them on election day. See you at the polls...

In reading through the threads, I can't help but notice there seems to be more interest in slamming people for their perceived political leanings rather than some reasoned debate about the article itself and the issues coming from the article. For one, I really do not care whether someone is a BC Liberal (in truth Conservative) or a New Democrat, Green, Communist, Socialist or anything else. Perhaps if enough heads come together with good arguments a concensus of opinion and viable solution to the problems can occur. You know one of my greatest regrets in life occurred in the 1996 provincial general election when I had the opportunity to attempt to force a BC Liberal candidate to debate the issues. At the outset of the campaign it was clearly evident that the Liberals candidates were being controlled and their personal views on issues affecting British Columbians were held in check. In the 2001 campaign it was clearly evident that the candidates were told to avoid any debates and in fact where they could avoid debating the issues confronting the voters they were hard to find. These thread debates should be real debates unlike those phony all candidates meetings where the party mantra is all important. I for one, want to know what the candidates think about issues, their points of view not the structured, party disciplined line. I want to know if they support the gradual elimination of the PST. I want to know if they support or would support removing MSP premiums and perhaps replacing them with an employment tax similar to Ontario where it is a tax on the employer (who benefits the most from a healthy work force). By the way, if the Americans ever wake up, they may realize the Canadian style medicare could be challenged under NAFTA as a subsidy to business. So how about a real discussion about these points rather than worrying about someone's political stripe and demeaning them for it.

Stan, I can't disagree with your issue above other than to say if you were to go to the Vancouver Sun etc., you wouldn't get any of this cross-political jabbing that takes place here. You'd get straight right-wing rhetoric and certainly not much in the way of critisism for Gordo, other than he hasn't been brutal enough. But to get back to the tax issue. It's fairly simple what is going on. This government emptied the bank in its tax brak for the wealthy in its first month or two of operations leaving absolutely no room for anything, but a need for increased economic growth. It didn't arrive, as any government that isn't hidebound to an ideology would have at least considered a remote possibility. Suddenly our sales tax was increased by eight percent (or whatever 1/14th represents). But since the wealthy took their gift and went on vacation (Hawaii was popular), or had a party or did anything but reinvest it in job producing opportunities, the Liberals began their slash and burn program for social services squeezing thousands upon thousands out through the rusting bottom of the safety net. Nearing the fourth anniversay of the gift to the wealthy, our provincial debt has sky-rocketed (something Liberals won't even discuss because they have tried to hide it from voters). Now that the sobering realities of this Darwinian exercise have started to spill messily into public view, the Liberals enact police-state hate legislation against any one poor and brave enough to think maybe squeegying is as free-enterprise and necessary as private liquour stores. Then they announce that sales tax is being dropped back to where it was before they were elected on a no-tax increase promise. But hey, they know there are more problems, so more money is poured out, this time from traffic tickets to the municipalities that have had to raise their own taxes to compensate for the previous mean-spiritness of this government. That some of these city bosses are now praising the gift, speaks volumes about the depth of wisdom in municipal circles, but that's another issue. So suddenly we have a Liberal government that will get praise from the Canwests and the David Blacks who pretty much control media in this province. Jees Stan, now I think I'm beginning to understand why Tyee readers are known to toss the odd verbal stone at someone soapboxing here on behalf of those weasels. I know, I know, but I just can't find a better description for people who say one thing and then do the exact opposite. I apologize to any animal or animal owner who might take offence with being tarred with the same brush as Gordo.

general motors corp. has stated it pays more in blue cross premiums in a year, employees and retirees, than it pays to any other expense/cost category. Obvious then the assumption a hidden ontario subsidy occurs , when all is said and done since the gm execs admit that is part of it's primary equation in staying in canada.

"The millionaire and the college student each pays the same tax rate on their purchases." Is this meant to indicate a problem? The millionaire is buying, say, a Lexus with a trunkful of Prada, Gucci, and Armani. The college student has a six pack and a couple of Top Ramen. If one spents 100 times as much, one pays 100 times more into the provincial coffers. Is that bad? Should the richies pay an escalating tax?

Ron, the poor, whether, studying or working, spend a far greater percentage of their earned income on sales tax than do your millionaires. That's primarily because more of their income goes directly into day-to-day needs of life, rather than into those expensive toys. Yes, I'm sure the wealthy do contribute on a grander scale individually into the province's coffers and, funny, but they also have a lot more opportunity to purchase after they have paid their taxes and bought their necessities than do the poor. It had been, until recent neo-conservative times, considered Canadian(at least in my movie), that those who benefit most from this country would return a larger share to the running of the nation, the province, the family.

"the wealthy do contribute on a grander scale individually into the province's coffers" Right. They pay more, net. But less, proportionately. This suggests that there's an onus of proportionate taxation. Not unlike a flat tax. I wonder how you would collect that. You could link the sales tax to ability to pay. Yes, that would be interesting.

Allan loved your response to my posting. Certainly I agree with most of what you have written. At the time of the so-called tax cuts, my partner and I were in the combined middle upper income bracket. We were surprised by the cuts and I guess because I was previously involved in the political process you could say I was stunned by the amount put forward by Campbell. Throughout the 1996 campaign we looked at the potential for tax cuts and we surmised that the absolute maximum tax cuts that could be advanced was approx $1B. without cutting services and maintaining status quo with the public service. The tax cuts even of that magnitude would have had a treasury payback of approx. $300m in otherword 30 cents on the dollar which for government is a good recovery through increased spending. When the 25% reduction was announced it meant this government had other things in mind such as taking revenge out on its' (our) employees. Keynesian economics allows that it is OK for governments to run deficits (structural or otherwise) during the down side of an economic cycle in order to maintain services to the taxpayers. Of course the flip side is that once recovery starts then government has the responsibility to repay the money that it has borrowed and to generate sufficient surplus to cushion the ecomony for the next downward cycle. This was very evident during the WAC Bennett government as his philosophy was to underestimate revenues in anticipation of future recessions thereby creating a cushion of some kind to maintain government revenues without burdening the taxpayer. At a guess, WAC is probably reeling in his grave over the incompetence of this bunch in Victoria today. The argument the was proffered by the Campbell Brothers is that by reducing taxes on the wealthy that they will be encouraged to re-invest into the economy. I think we have seen that certainly has not happened. Individuals tend to take their tax cuts and pocket them. BC companies may re-invest into the BC economy but quite frankly my experience is more with multi national and trans national companies that take the tax cuts, apply it to their gross profits and invest elsewhere. Have you noticed a marked increase in the number of speed traps since Campbell announced the turning over of fines to the municipalities? I am in town once or twice a week on business and I have noticed speed traps in spots that I have never seen them before, not that I really speed (all that much). The Minister of Finance would say that there have been no real tax increases during this administration. Call me crazy but a levy is a tax which they seem to apply a tax on top of, MSP premiums are a tax under a different name; increases in User Pay fees seems to me to be a tax increase, tolls on highways are a tax to use a specific highway. We certainly do not want to comment on the Coquihalla toll on a highway that has more than paid for itself (you bet WAC is rolling in his grave after all he eliminated tolls on the L.G. Bridge).

To Ron and Allan in response to your points on sales taxes. Years ago at the Federal level we had a very convaluted method of handling sales tax (Manufacturers Tax) which was a hidden tax with a huge bureaucracy running around doing compliance audits. Manufacturers and Wholesalers could apply for a tax license which in essence deferred the tax ultimately to the end user. Problem was there was too much paperwork involved and too many regulations to contend with. The GST evolved to simplify the tax collection method, reduce (haha) the regulations and throughput the tax collection to the ultimate end user. In practice the current federal method does in fact work very well, other than the regulations. Fortunately for my and my partners' company we are exempt from charging GST as we deal with international freight and as such we get most of what we pay back. There was also a federal excise tax license which for the most part referred to luxury items such as jewellry, clocks and watches, lighters etc. Today we still have excise taxes which are now called excise duty. Interestingly, the feds discovered that they could not tax a tax but they can tax a duty rate. On imports to calculate GST payable you now add the appropriate duty and excise duty to the value of the goods and then multiply out the GST on the combined total of value of goods plus duties. They managed to get a few more dollars that way. Taxes on luxury goods have always been there in some form or other. To ensure that higher value goods which most of us cannot afford it is possible to classify specific commodities for higher tax rates. How many people are aware that there is an excise tax of automobile air conditioners? I suspect not many, not even when they go out to buy a car, they tend to gloss over that item on the sticker. Canada was never "an every man for himself society" we historically have believed in the common good. Somewhere over the last decade we have lost that value that was intrinsic to Canadian society and separated us from the US. If it were up to me I would prefer to see the PST eliminated over time or take the PST/GST roll it into the shelf price with some minor rounding and allow retailers to submit based on their actual sales. Yes, the tax would be hidden but I would rather pay the 12.95 on the shelf than try to mentally calculate what the taxes would be. Of course the last time we faced something like this was the conversion to metric and I think we all know about the gouging that took place then.

To Invalid, yes indeed GMC and others are extremely happy with the Canadian Style Healthcare system. While they have to pay the Health Employment Tax, they also get to write it off their earnings. Basic health services in Canada are very heavily subsidized by the taxpayers for which we pay higher taxes than the Americans. While I am not an economist, I would guess that if we took the health care costs out of government our tax rates would be very similar to the US (which in my opinion is undertaxed severely).

Actually Ron, I wouldn't think sales tax to be the avenue for proportional anything. No, I think that hurdle is best placed where it is now, on income tax calculations, where a little more of the stuff that pays for the Lexus and the foot-fetish is part of the equation. ---------Stan, this hiding of taxes as tolls, levies, etc., etc., etc. is a convenient way to slide an awful lot by with without referring to taxation. WAC is remembered as a builder whether you liked some of his politics and cohorts or not. I pine for that stability today. This gang of sledge-hammers have "wrecking crew" written all over them.

While MSP premiums are a pay-roll tax for the majority of people (I'm guessing), they aren't for everyone. I remember writing a cheque to MSP for my coverage. The increased costs in MSP to my family will no way make up the difference that half a percent off in PST will.

To Chris H. it is an employment health tax in Ontario; BC and I believe AB are still premium based while other provinces, mainly in the Maritimes just make part of their provincial budgets. To Allan; I think a lot us miss that stability and forward vision. Let's see wrecking crew, hmm selling off the assets of the province that would provide longterm stability around which effective industrial planning can occur. Yes, indeed ideological wrecking crew would certainly apply.

Stalking you adam lol, I say it the way I see it no more no less!

I am amazed that anyone (except for maybe the extremely wealthy) reading this article or simply looking at their own personal/family finances, hasn't reached the following conclusion: This government has significantly inceased overall taxes (fees levies etc)to the detriment of us all. Add the increase in the Provincial debt and sell off of public assets, and then grade this goverment honestly. Surely they deserve an F in fiscal responsibility and financial management.

I wanted to comment on the slight, but important, inaccuracy of the article that states, "There were early concerns over the constitutionality of provincial sales taxes. The British North America Act permitted Ottawa to enact any and all forms of taxation, but restricted the provinces to "direct" taxes." In fact Ottawa was restricted by our Constitution to sources of income other than "direct" taxes. This is why Ottawa asked the Provinces for permission to "temporarily" tax its citizens directly. Now that this has become a permanent institution (through income tax and the GST) our Constitution has been altered "de-facto." I strongly suspect that this is part of how the rich have taken over our tax system, since Ottawa now collects most of its revenues from the middle class. By the way, I can't find Linda McQuage's article on the CCPA's website.

To Ian in Nanaimo: While I appreciate your comment on what you suggest is an inaccuracy regarding federal taxing authority, you are mistaken. The ‘Distribution of Legislative Powers’ is addressed in Part IV of the British North America Act, and therein section 91 defines the ‘Powers of the Parliament.’ Among the many exclusive responsibilities of the federal government is that of sub-section 91.3, "The raising of Money by any Mode or System of Taxation." The following section, 92, covers "Exclusive Powers of Provincial Legislatures." Sub-section 92.2 states: "Direct Taxation with the Province in order to the raising of a Revenue for Provincial Purposes." BC introduced its income tax in 1876. Ottawa introduced its income tax in 1917 to help finance the First World War. For several years thereafter, the federal government and several provinces both levied income taxes. However, the Second World War was exceedingly costly, and Ottawa required larger sources of revenue. Negotiations between the federal and provincial governments continued over many years following the war, and led to a series of "tax rental" agreements whereby Ottawa collected the income taxes while providing subsidies to the provinces. You might enjoy a readable two-volume history of Canada’s fiscal system, Taxes, Tariffs and Subsidies, written by J. Harvey Perry and sponsored by the Canadian Tax Foundation. Will

Ian she writes for the torontostar try here for the piece you are looking for or go to the star if this doesn't work, columnist, other where you will see her name.http://www.thestar.com/ NASApp/cs/ContentServer?pagename=thesta r/ Render&inifile=futuretense.ini&c= Page&cid=970599109774&ce=Columnist &colid=1022182710415

Regarding the effect of tax cuts: in george soros continuing examination of the world and its problems, he sites financial capital as the completely globalized economic resource, even to the extent of removing local capital from third world countries, as it makes economic sense for an individual to place his or her capital into the world stream and avoid local upheavals. So whether its federal USA or provincial BC tax cuts, the extra wealth left in the hands of individuals is most likely held as some form of personal investment (anything from a chequing account to a hedge fund) which may increase economic activity somewhere in the world, but as shown in both the noted cuts, not necessarily or even likely in the geographic area where the cuts have been enacted.

Doug in Burnaby...somewhere like the Grand Caymans...

hard to imagine the B.C. administration cancelling the sales tax ,four billionsis alot, where would the replacement revenues come from? It seems every time the administration wants to reduce a program/expense the public crys foul. Hopefully some visionary will give us a new idea. Oops I think that is how we got this way in the first place.