HST OP-ED: HST a better long-term choice

Ida Chong weighs in on the HST

The HST has been a very contentious issue for British Columbians and I’ve spoken with many Oak Bay-Gordon Head residents who have been upset or confused by our government’s decision to harmonize sales taxes. I understand these concerns, but believe strongly that the HST will lead to increased economic growth, increased competitiveness and job creation.

Our government recently engaged in a series of tele-town halls and heard from more than 275,000 British Columbians on how we could improve the HST. We heard from the public that they were dissatisfied with the way this tax was introduced and they felt the HST was hurting families and low-income seniors disproportionately.

We listened and we have committed that if B.C. residents vote in favour of retaining the HST, we will reduce the tax from 12 per cent to 10 per cent. The provincial portion of the HST would be reduced from seven to six per cent on July 1, 2012.  A further reduction, to five per cent, would take place on July 1, 2014.

Under a 10-per-cent HST, B.C. families will, on average, be roughly $120 better off on their routine expenditures than they were under the combined PST-GST system.

In addition, one-time transition payments this year will help families and low- to modest-income seniors as we move towards those rate reductions. Families with children under 18 will receive an additional $175 HST transition payment for each child, single seniors with incomes up to $40,000 will receive $175, and senior couples with family incomes up to $40,000 will receive $350.

We introduced the HST for several reasons, but most important was the benefit the HST has on B.C.’s economy. Under the PST, businesses paid sales tax on many of their input costs and passed those costs on to consumers in the form of higher prices.

I’ve spoken with many business owners who have told me they’ve been able to renovate their businesses, hire more staff and lower prices thanks to these HST savings. All of those benefits help to strengthen our economy and create the jobs B.C. families depend on.

The HST is a better and simpler tax than the PST-GST. It’s easier to administer, helps to create jobs and expands the economy. Returning to the PST will put a $3-billion hole in the provincial budget over the fiscal plan, which will impact our ability to fund programs, return to fiscal stability and balance budgets.

I encourage you to please vote “no” in the upcoming referendum to preserve the HST, rather than returning to the inefficient and expensive PST-GST system.

Ida Chong is the Liberal MLA for Oak Bay-Gordon Head.