10% HST cheaper than PST, study finds

A 10 per cent harmonized sales tax will cost an average B.C. family $255 a year less than returning to the former provincial sales tax, according to a new study.

Fight HST organizers Bill Vander Zalm and Bill Tieleman visit Elections BC office in Victoria Wednesday. They want the B.C. government to allow people to vote late if they didn't receive their HST referendum packages in time.

VICTORIA – A 10 per cent harmonized sales tax will cost an average B.C. family $255 a year less than returning to the former provincial sales tax, according to a new study.

David Murrell, professor of public finance at the University of New Brunswick, released the first version of his study last year, examining the switch to the HST in B.C. and Ontario. He calculated a 12 per cent HST would cost an average B.C. family an extra $490 in new sales taxes paid. Factoring in low-income tax credits and grants, the B.C. HST would mean an net $320 tax increase.

After the B.C. government announced it would reduce the HST rate to 11 per cent next year and 10 per cent in 2014, Murrell updated his calculations and released the results this week.

“If I were a B.C. voter, based on this evidence, I would vote ‘no’ in the HST referendum,” Murrell said.

Murrell did a similar study in 1997 when Nova Scotia, New Brunswick and Newfoundland expanded their provincial sales tax to include services, and cut the rate to eight per cent. He also found a net saving to taxpayers in those provinces.

B.C. consumer savings come from three sources, Murrell said. Goods that were subject to PST will now have it reduced to five per cent. The government has offered personal income tax credits to help compensate for the new HST. And businesses pass on savings from writing off taxes on material inputs and capital spending, lowering the price of products and services.

Jock Finlayson, vice-president of the Business Council of B.C., said Murrell’s study is the first independent academic analysis he has seen since the HST rate cut option was announced in May.

Finlayson said he has heard many times that people don’t believe prices will be reduced as a result of HST tax breaks. But independent researchers have looked at the switch from retail sales taxes to value-added taxes around the world, and “without exception” they find that lower prices result, he said.

With the Aug. 5 deadline for voting in B.C.’s HST referendum approaching, Fight HST organizers Bill Vander Zalm and Bill Tieleman visited Elections BC facilities where they will observe as ballots are counted.

They told reporters they have heard from hundreds of people concerned they won’t receive a voting package in time to participate, and called for the government to intervene and establish a mechanism to allow late voting.

“If [voters] called Elections BC and they were sent a package, it should get to them and they should be allowed to vote,” Tieleman said.

Finance Minister Kevin Falcon, reached at a cabinet retreat in the Okanagan, said it is “ridiculous” to suggest that the government try to interfere with an independent office that has successfully supervised many elections and referendum votes.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

B.C. government eyes antlerless moose harvest increase in bid to save caribou

Antlerless moose hunts reduce predation for threatened mountain caribou, says ministry

Conservation society hosting Free Your Things Weekend event June 20-21

Residents are encouraged to place reusable items with a free sign clearly visible

Williams Lake RCMP request public help in finding clues to stolen Dodge truck

Incident not linked to Tuesday’s hunt for a suspect who collided with a police car

UPDATE: Williams Lake RCMP suspend search overnight for suspect on the run

Public asked to keep eye out for suspicous activity

Rotary Stampede Community Spirit Drive-Thru Breakfast planned for Williams Lake, July 4

Stampede director Tim Rolph shared details during Tuesday’s city council meeting

If Trudeau won’t stand up to Trump, how will regular people: Singh

Trudeau did not directly answer a question about Trump’s actions amid protests

Facing changes together: Your community, your journalists

Thanks for helping the Williams Lake Tribune continue its mission to provide trusted local news

Murder charge upgraded in George Floyd case, 3 other cops charged

Floyd’s family and protesters have repeatedly called for criminal charges against all four officers

As two B.C. offices see outbreaks, Dr. Henry warns tests don’t replace other measures

Physical distancing, PPE and sanitizing remain key to reduce COVID-19 spread

Young killer whale untangles itself from trap line off Nanaimo shore

DFO marine mammal rescue unit was en route as whale broke free from prawn trap line

Racist incident shocks Vancouver Island First Nation

Port Alberni RCMP investigating after video shows truck wheeling through Tseshaht territory

Vancouver Island school principal mourns brother, cousin killed during U.S. protests

Jelks says he’s grateful for the outpouring of support from the community in the wake of this tragedy

Bank of Canada keeps key interest rate target on hold at 0.25%

Central bank now expects GDP to decline between 10 and 20 per cent compared with the fourth quarter of 2019

RCMP, coroner investigate murder-suicide on Salt Spring Island

Two dead, police say there is no risk to the public

Most Read