Blair Qualey
president and CEO of the
New Car Dealers Association of B.C.
With the introduction of the harmonized sales tax in British Columbia on July 1, some misinformation has surfaced as related to the HST and its affect on new car purchases.
In fact, the new HST has zero effect on the amount of tax that will be paid on a new car, and some consumers will even pay less for their vehicle under the new tax rules.
New car dealers across B.C. are receiving phone calls from consumers who are concerned that the new blended tax will make a new car unobtainable. The reality is that both the GST and PST, which are blended together to form the new HST, were already charged on all new vehicle purchases prior to the introduction of the blended tax.
This means that the total tax we must charge on a new vehicle remains exactly the same - 12 per cent - as it did prior to July 1.
Some new vehicle consumers will actually find savings with the HST when they visit our showrooms, in that its introduction means the elimination of the vehicle "luxury tax" of up to three per cent on new cars worth more than $55,000.
Consumers who are researching to purchase a used vehicle should also know that the combined tax rate means that private sales are now subject to the same tax as public sales.
This means that, dollar-for-dollar, buying a used car from a private seller will cost the same - if not more, due to the competitive pricing that only an established dealer can offer - than buying from a new car dealership.
Our industry is transitioning out of an undeniably difficult time with exciting technological advances and low sticker prices showcased on the showroom floors of new car dealers across this province.
Consumer confidence is returning and we continue to closely monitor the needs and concerns of our consumers to ensure we are offering the clearest information available with regards to perceived impacts of the HST.
The introduction of the HST has no affect on purchases made on new cars in B.C., and therefore the current industry climate continues to offer consumers the perfect conditions under which to research and buy a new vehicle.
For more information on the New Car Dealers Association of B.C., visit http://www.newcardealers.ca.
