Most of us have been warned at one time or another about cutting off our nose to spite our face. At first blush that seems to be what happened when a majority of us voted to ditch the harmonized sales tax last year.
As a province, we stood up on our hind legs and told the Liberals we were mad as hell and we weren’t going to take it anymore. Gone, we said, were the days when a government could arbitrarily change our tax system without paying the consequence. And perhaps what galled the most was the prior proclamation made at election time by then premier Gordon Campbell that no new taxes were in the works.
This time it appears that not only tea will be thrown in a harbour, but an entire government when the Liberals may find themselves, figuratively speaking, in the Victoria Harbour after next year’s election.
Many small business people, we suspect, felt the same as Gibsons’ Narie Kinao when it came to voting to keep or toss the HST. As individuals, they preferred the old system, but as business people, the HST was preferable. So in order to be true to themselves as people, we figure they voted to ditch the hated sales tax.
Now comes the time of reckoning.
Finance Minister Kevin Falcon announced on May 14 that the resurrected version of the PST will have all of the exemptions of the old provincial sales tax, but will be less cumbersome to administer. It is a “better stupid” PST than the former (merely) stupid tax.
The tax will come into the 21st century with on-line forms and perhaps the mile-long waits at local banks in mid-month will be a thing of the past.
For many businesses such as newspapers and restaurants, this will mean an end to collecting the provincial portion of taxes. We will no longer be able to claim many expenses, but our customers will effectively see an immediate five per cent drop in the cost of items such as ads or meals.
Local restaurants appear divided in their reactions to the phasing out of the HST. Some, such as Lighthouse Pub and Buccaneers owner Dale Schweighardt, feel his staff will realize bigger tips once the tax reverts to GST only. Others, such as Lina Jakobs of the Bonniebrook Lodge and Chasters, think the move will cause restaurant costs to go up and the rise will ultimately see its way to the customer’s bill.
For two of the Chambers of Commerce on the Coast, Gibsons and Sechelt, the return of the PST is a retreat to a less efficient, costlier way of doing business.
Lost in much of the rhetoric of the past week is how we’ll repay the federal government the billions owed because of the scrapping of the HST. If history is any indicator, a large liability by the provincial government means only one thing — an increase in provincial taxes.
That consequence is as plain as the noses that used to be on our faces.