Tuesday, September 14, 2010

Campbell gambles with an HST flipflop

The twists and turns on the HST roller coaster are getting dizzying.
Premier Gordon Campbell delivered the latest sudden change of direction this week.
After insisting the harmonized sales tax is critical to the province’s future and maintaining that he was prepared to pay the political price for bringing it in, Campbell abruptly abandoned that tack.
The Liberals on the legislative committee considering the anti-HST petition rejected an NDP proposal to send the bill to the legislature immediately, one of two options allowed under the act.
Instead, it will go to a referendum next Sept. 24.
The Liberals had signalled they were leaning toward that option.
That appeared to mean the anti-HST effort was doomed.
Under the initiative act, a majority of all registered voters would have to vote to kill the tax for the initiative to go ahead - not a majority of those who voted.
That means some 1.5 million people would have to vote to axe the tax - more than the number who voted for the Liberals and New Democrats together in 2009.
And in the tiny event that the initiative passed, it would not be binding.
The tax, it seemed, was here to stay.
But hours after the committee made its decision, Campbell changed everything. "If people decide they want to get rid of the HST next September, then I guess we'll get rid of the HST next September," he said.
Campbell was more specific. If a simple majority of those who vote in the referendum next oppose the tax a year from now, his government will repeal it.
It’s a remarkable flip-flop and a significant gamble.
What prompted the change? Perhaps Liberals inside and outside caucus convinced Campbell that the party’s bungled handling of the tax - especially its insistence that voters were just to dim to know what was good for them - was doing massive damage.
Perhaps he’s looking to stall recall campaigns against Liberal MLAs by arguing that the public will get a say on the tax.
Certainly Campbell is counting on being able to sell the benefits of the HST - and the complications of removing it - over the next 12 months.
That’s not a sure thing. The Liberals’ actions in bringing in the tax won’t soon be forgotten.
And there is a risk that the effort to sell the tax - with taxpayers’ money or the support of business groups - will backfire.
Meanwhile, expect the political squabbling to continue. Bill Vander Zalm, the anti-HST champion, wants Campbell to bring back the legislature and give his commitments the force of law by amending the initiatives act.
Concerns are already being raised about the referendum question and whether Elections B.C. or cabinet gets to draft it. It’s unclear whether a mail ballot - cost about $12 million - or a polling station approach - cost about $30 million - will be used.
Economically, the uncertainty is bad news. Will a homeowner considering a major renovation start the work next spring or put it off to see if the HST is defeated, cutting the cost significantly?
Companies considering an investment now have no way of knowing what taxes they would pay in the province.
And all this will keep the damaging issue front and centre for another year, taking the Liberals that much closer to the 2013 election.
The change of position on the HST smacks of desperation. But that’s not surprising. Campbell and the Liberals are desperate.
And many are likely realizing how much of this damage is self-inflicted. Rejecting the tax in the election campaign, starting work on introducing it days after the vote, failing to consult anyone, wasting $800,000 on pro-HST flyers and then throwing them in the garbage - it’s been a gong show.
The referendum might buy the Liberals some time. It’s not likely to write them a happy ending to this story.
Footnote: The government got $1.6 billion from the federal government to bring in the HST, which would have to be returned if the tax is killed. About $1.4 billion is budgeted for this year and next. The government would be prudent to remove that money from its budget plans until after the referendum, especially given projections of a smaller-than-expected deficit.


DPL said...

Gordo has changed his position on many things, many times.He simply has no credibility and a number of his MLA's are going to get recalled and soon.

Anonymous said...

ICBC has plenty of extra money (more than is needed) in its coffers to pay back the 1.6 billion from Ottawa. Simply pay back the bribe.

Anonymous said...

Paul, I think your last comment is right on point. It would be reckless for a government of "prudent fiscal managers" NOT to begin to set money aside in the event the tax is rejected next year. Instead it'll be a PR effort to shift the blame to those who speak against the HST. Not an unreasonable tack given that, in my opinion, the Liberal's tenure has been an extended masterpiece of spin.

At the centre of the "gong show" is one man's pride in not wanting to back down from a bold commitment to hold the line at a specific number on the deficit. And the lengths he was prepared to go to maintain it before the fall.

Anonymous said...

Can anybody explain why the NDP flip flopped and voted for the referendum option?


My hope is that the corporate media will take this opportunity to examine how the BC Liberal budget fell apart by $1 BILLION in one month - coincidentally while we were all distracted by a provincial election.

Anonymous said...

Gordo has only ever listened to his business contributors plain and simple. Perhaps Phil H. and company should pass the hat and pay for the several million in advertising that it will cost to run the propaganda programme for the HST. Recall in the Fall.

Crankypants said...

For those that wonder why the NDP voted for the referendum in the end, it is customary for a standing committee to make whatever decision they make a unanimous vote. It was always a foregone conclusion that the Liberal side would decide the route they would take as they had the majority.

As far as Gordo's assertions that a simple majority will be sufficient and he will abide by the results, don't buy it for a moment. It is not his choice to make unilaterally. A decision such as this must be made through the Legislative Assembly. This is nothing but a ruse.

Anonymous said...

I think Campbell has finally had enough of the voters in B.C. and he has basically dressed up this referendum as way we can all vote to screw ourselves. Whether you like HST or not, at this point it is almost irresponsible to allow a largely uninformed and often rapidly misled population to simply vote out the HST. I expect there would be far more damage done trying to undo the HST then what has been done to date with the so called implementation. Personally I don’t think Campbell has any intention of being around next September. I think he is basically ready to jump off the bus and leave it up to the masses to fend for themselves. The so called voters have not exactly been stellar citizen’s either with some of the idiocy going on. Just listen to any radio talk show caller, some of these people are truly clueless, and sadly there are those who prey on that stupidity for political gain.

Anonymous said...

Today's (Sept/15) Vaughn Palmer column is titled HST referendum 'not about me', B.C. premier says

I say: "Prove it. Resign!"


As a tax paying British Columbian; I wouldn't mind too much if some of the $30 MILLION referendum cost was ameliorated by 'rolling' the HST vote in with the fall 2011 municipal vote.

Having two province wide votes only six weeks apart is a complete and incompetent waste of money.

Anonymous said...

PW wrote: "wasting $800,000 on pro-HST flyers and then throwing them in the garbage"

$250,000+ went to the design of the flyers.

Who got that untendered contract?

Has anybody seen one of these mythical beasts?

Kim said...

Crankypants is right. It's a ruse. Campbell will abandon ship just before the vote. That way he doesn't have to keep his word and doesn't smear his successor. That's exactly why he won't change the legislation, but wants us to take his word.

Did he forget about Railgate? I have not!

Anonymous said...

We the citizens, will not forget Railgate. We will not forget, any of the dastardly deeds Campbell has done. We also, won't forget Harper's part, in the HST either. Anything Campbell or Hansen say is, automatically deemed a lie. Trust Campbell and Hansen? Not on your nelly. Trust the gruesome twosome, who, lied, deceived and cheated to win, never. BC is a province, in a deep morass of corruption. We should, run Campbell out of town, on the BC Rail, that is, if we still had it. Campbell can stick his constitution up his referendum. Recall, or a general strike.

Anonymous said...

Above I wrote: "My hope is that the corporate media will take this opportunity to examine how the BC Liberal budget fell apart by $1 BILLION in one month - coincidentally while we were all distracted by a provincial election."

I got my facts wrong and I sincerely apologize to you all for my error.

According to today's (Sept/16) Palmer column: "As we now know, on May 14, two days after the election, *Whitmarsh briefed the finance minister and the premier on the news that with a month and a half gone in the financial year, provincial revenues were already off by $1.5 billion." I was off by half a billion and two weeks.

* = deputy finance minister Graham Whitmarsh, former salary slave in the premier's office

Unfortunately that is as close as any corporate media has been to examining the genesis of this HST fiasco.

Two other bits in VP's column worth noting

- it only took Harper's conservatives TWO days to come up with "the $1.6-billion windfall in federal transition funding"

- the facts cited were "not included in the material supplied to the press gallery in response to a blanket request for internal Finance Ministry documentation on harmonization in the pre-election period."

Which means that not only are the BC Liberals starting their prereferendum campaign having to explain why they turned down two previous FOI requests and why the information they did turn over was so heavily (and needlessly) censored, But they also need to truthfully tell us why the Palmer documents were excluded from the release.