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BC Liberals' 'Political Suicide Note'

What Premier Campbell won't tell you about the disastrous HST. How to help stop it.

Bill Tieleman 6 Apr

Bill Tieleman is a regular Tyee contributor who writes a column on B.C. politics every Tuesday in 24 Hours newspaper. E-mail him at [email protected] or visit his blog.

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Premier Gordon Campbell and Finance Minister Colin Hansen.

"We do not support harmonization because of the $400-million burden of taxes that is going to go from business to consumers in this province and we think that's entirely inappropriate." -- Saskatchewan Finance Minister Rod Gantefoer

There's a lot you aren't hearing about the disastrous effect the B.C. Liberal government's plan to impose a Harmonized Sales Tax will have on the province.

Given that Premier Gordon Campbell didn't tell you he would jam an HST down your throat before last year's election -- even telling the restaurant and development industries in writing that the B.C. Liberals would not do that -- it's important British Columbians know the facts.

And you can hear them for yourself tonight, Tuesday, April 6 at 7:30 p.m. when I speak at a town hall meeting at Kitsilano Secondary School at Tenth Ave. and Larch Street in Vancouver, featuring former B.C. premier Bill Vander Zalm and ex-Unity Party leader Chris Delaney to launch the Fight HST citizens initiative to stop the HST.

But here's what you haven’t heard, certainly not from the B.C. Liberals.

Why a right-wing party rejected HST

First, the right-wing Saskatchewan Party government last month strongly rejected the idea of an HST because the HST's enormous tax hit would flatten consumers while transferring all the extra money raised to big business.

Saskatchewan Premier Brad Wall made that clear last August: "You know in an election campaign in 2007, I was asked about harmonization and I said that we wouldn't be going in that direction if we were elected... we don't think it's right."

That's refreshing to British Columbians, a premier who tells voters the truth both before and after an election -- and keeps his word.

Maybe that explains why Wall has a 56 per cent approval rating in Saskatchewan while Campbell only has the approval of 23 per cent of British Columbians, according to a recent Angus Reid Public Opinion poll, barely ahead of Ontario Liberal Premier Dalton McGuinty's 21 per cent.

Hmmm. The popular Wall rejects the HST while the unpopular Campbell and McGuinty are about to impose a hated new tax on July 1 -- coincidence?

A left-wing party rejects HST, too

Second, Manitoba's left-of-centre New Democratic Party government has also ruled out the HST for the same reasons.

And while the B.C. Liberal government only produced a study of the impact of the HST a full eight months after announcing it would be imposed -- and it was a 13-page paper by a known HST supporter saying jobs would be created over ten years -- Manitoba actually researched the issue before making a decision, something unheard of here.

Its report concludes that if the HST were adopted, "Manitoba would impose $405 million in additional sales taxes on families, increasing their share of the sales tax burden to 86 from 54 per cent."

Said Rosann Wowchuk, Manitoba's finance minister, "With the global recession causing so much economic uncertainty for Manitoba families, we don't think it makes sense to impose $405 million in new sales taxes. We are not prepared to risk the economic recovery by undermining Manitoba's growing consumer confidence."

It's worth noting that Jack Mintz, the professor who produced B.C.'s slim report for $12,000, and also produced a similar study for Ontario, previously said two years ago that introducing the HST would actually cost Ontario 38,000 jobs.

$2 billion annual taxes shifted to consumers

So, both a right and left wing government reject the HST for exactly the same reasons -- because an HST will dramatically shift taxes from big business onto consumers, causing an economic disaster at the worst possible time.

For British Columbians, that means consumers will pay an extra $2 billion a year in order to give that same amount of money to large corporations.

You likely have heard, because B.C. Finance Minister Colin Hansen and others keep repeating it, that three Atlantic provinces have done just fine since introducing the HST there in 1997.

But what Hansen doesn't tell you is that the sales tax in Newfoundland, Nova Scotia and New Brunswick actually dropped when the HST came in -- while in B.C. it will rise on hundreds of goods and services!

Newfoundland's sales tax went from 19 per cent to 15 per cent initially and later to 13 per cent, and Nova Scotia and New Brunswick's went from 18.7 per cent to 15 per cent initially and later to 13 per cent.

So for those Atlantic Canadians, the HST meant a significant tax cut, not a painful increase.

But in B.C., when the seven per cent Provincial Sales Tax is combined with the five per cent GST to apply a new 12 per cent HST tax, it will be levied on consumer goods and services like restaurant food that were not previously subject to the seven per cent PST.

And you probably haven't heard that Saskatchewan briefly adopted the HST in 1991 and -- after the defeat of the Conservative government which introduced it -- the new NDP government of Premier Roy Romanow rescinded it immediately.

This is no 'done deal'

Lastly, a lot of political commentators and HST supporters are telling British Columbians the HST is a "done deal" and that the citizens initiative process led by Vander Zalm will either fail or won't work because it isn't binding on the government.

Wrong on all counts.

The initiative, first championed in this column on Aug. 18, 2009 as one way to fight the HST, has a real chance of success.

The Fight HST volunteer campaign -- which I am part of -- has nearly 5,000 canvassers signed up to take signatures. And my NO BC HST Facebook protest group has over 131,000 members to draw recruits from.

It is a difficult process to obtain the signatures of ten per cent of all registered voters in every one of B.C.'s 85 ridings -- but not impossible at all.

It is not, unfortunately, binding on the government.

But consider this -- 77 per cent of British Columbians oppose the HST according to the most recent polling. And that's before the tax even starts taking money out of their wallets and purses.

Any government that imposes policies strongly opposed by an overwhelming majority of voters is likely to be removed from office. Think of federal Conservatives after forcing the GST onto Canadians and going from a majority government under prime minister Brian Mulroney to only two seats in the next election.

'Longest political suicide note in BC history'

As NDP MLA Leonard Krog quipped last week, the 213-section and nearly 100-page HST legislation introduced by the B.C. Liberals is "the longest political suicide note in provincial history."

With the Orwellian and misleading title the Consumption Tax Rebate and Transition Act, the B.C. Liberals' Bill 9 may go down as Gordon Campbell's electoral version of Little Big Horn.

In November, B.C. voters can start the recall process against MLAs who supported the HST -- and they'll have had five months of paying the HST to give them an incentive.

So will the most obvious and simple political calculations cause Campbell to listen to public opinion and cancel the HST?

We'll soon see, but one thing is clear. If the B.C. Liberals win the HST battle to impose the new 12 per cent tax, they will surely lose the political war that it has sparked.  [Tyee]

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