Todd Whitcombe
As I See It
Vaughn Palmer wrote a rather interesting column last week in which he pointed out the futility of the petition drive to repeal the HST.
Much of what he said is perfectly accurate. The petition drive had to wait for the introduction of the legislation and that means that the timelines do not mesh well. The HST will be well and truly part of our lives - and our economy - long before there is any chance that the repeal effort will succeed and take hold.
Even if the petition is successful forcing a referendum in September, 2011, that will be some 14 months after the implementation HST and there will be little chance to untangle the provincial and federal sales taxes.
And even if the provincial initiative is successful, it is not binding on the federal government. They do not need to re-negotiate the agreement nor agree to cease collecting the tax. It would be a messy court battle to force a change and, short of that, no way to force the federal government to comply.
All of this is true and we should beware that this business subsidy is going to be put in place whether we like it or not.
However, none of this negates the importance of signing the petition against the HST. Indeed, I would like to offer - with tongue planted somewhat in cheek - the top 10 reasons why you should sign the petition:
n 1 - Because anything that can get Bill Vander Zalm and Carol James on the same side of an issue has to be something that should be supported. Indeed, politics makes for strange relationships and this is one of the stranger relationships.
It should give anyone pause to think.
n 2- Because it is a new tax when we don't need to be taxed any further. Yes, I know that it is only replacing the present provincial sales tax but it will apply to many items - and more importantly, services - than the present tax. It will be applied in many new ways.
n 3 - Because it won't really succeed in its objective which is to give our export industries a subsidy that will help them remain competitive in a global market place. The costs of manufacturing are tied more to human labour costs than to capital investment. Over half of the provincial GDP is salary mass and it is that salary that determines market prices. It is in the costs of labour that we can't and won't compete.
n 4 - Because it is a quick fix for a provincial government to pretend like they didn't completely fudge their 2009 pre-election budget. And it allows them to pretend that they have made a substantial effort at controlling the deficit in the present fiscal year.
n 5 - Because the name is too easy. I mean, we all know what "BS" is. It is not hard to think of what "HS" could stand for.
n 6 - Because implementation has been too quick without the due care and attention that such a major shift in the structure of our tax policy deserves. This is a major shift in a progression that has seen the province move from "income based taxes" to "consumption based taxes." The argument has been made that consumption based taxes are more reasonable. After all, if you don't want to pay taxes, don't consume.
However, there is a flaw in that argument in that there is a certain level of consumption that is necessary for basic living. Food. Clothing. Shelter. These are essentials. Some will remain exempt from the HST. But as the effects of the HST ripples through the economy, the price of these goods will go up so while they may not be subject to direct taxation, they will be affected by the HST.
n 7 - Because the HST has been cynically tied to "health care costs" which means that the government now has a real easy mechanism to either (a) increase the HST rate or (b) limit health care costs.
n 8 - Because it will disadvantage people on fixed incomes, at the lower end of the socio-economic strata, and young people just starting out. Consumption taxes affect everyone equally which might sound good, but some people are better able to withstand the increased costs than others. And at an average of $400 per person, it is going to be a lot to bear for everyone.
n 9 - Because a petition, even if it has no real hope of successfully blocking the HST, sends a vary clear message that it is being implemented against the will of the people of the province. And that is a message that no government should ignore.
n 10 - Because it is the wrong tax, implemented in the wrong way, at the wrong time, for the wrong reasons. The government needs to be told that.
