HST turning into a political disaster

Finance Minister Colin Hansen's uncharacteristically snarky reaction to an Elections BC ban on a government campaign to sell the HST is a sign the Liberals are worried.
The Campbell government forced the HST bill through the legislature last week, using closure to shut down debate. All the Liberal MLAs, who ran on a platform rejecting the new tax, voted in favour. All New Democrats and Independent Vicki Huntington were opposed.
The broken promise not to bring in the tax and the widespread belief that the Liberals kept their real plans secret during the election campaign have turned into a devastating political issue.
The anti-HST initiative campaign led by former Bill Vander Zalm appears to be going strongly.
The legislation allowing British Columbians to petition for a referendum sets what most saw as an impossible threshold. In opposition, Gordon Campbell said the New Democrat legislation was designed to ensure initiative efforts would fail and promised changes. (That never happened.)
But opponents of the HST, or people just angry at a government that promised one thing and did the opposite, are flocking to sign the initiative petitions.
The task is still huge; 10 per cent of people on the voters' list for the last election must sign for the initiative calling for a referendum on the HST to succeed.
Even then, the result is uncertain. Provincial and federal governments signed the deal in November (six months after the election campaign in which the Liberals ruled out introducing the tax).
Hansen was testy after Elections BC said the government's plan to spend more than $2 million on a mailer defending the new tax would break the law.
The act is designed to keep rich special interests from buying legislative change. Interest groups - and the government is an interest group - must register and can't spend more than $5,000.
Hansen said the ruling was unfair. The government would normally send out ad material about the budget.
But Sean Holman reported on publiceyeonline.com that Elections BC raised its concerns by April 22 after the public affairs sought an opinion.
And the independent office that protects the integrity of voting in B.C. didn't rule against a budget mailing, just the sales job on the HST.
The tax betrayal has been damaging for the Liberals, leaving them looking either dishonest or incompetent. Dishonest if they promised not to introduce the tax while secretly planning to move ahead. Incompetent if they had been rejecting a change that Hansen now says is the single best thing that can be done for the B.C. economy.
Basically, the HST will cut taxes for businesses by $1.9 billion a year and increase the taxes paid by individuals and families by the same amount - something like $460 a year per person.
That's good for business and encourages investment in the province. The government maintains that's good for you, despite the higher tax bill. Businesses might pass on their lower taxes in price cuts. They might need more employees. They might have to raise wages to attract good people.
Or they might pocket the tax cuts and invest in machines that reduce the number of people they need to employ.
The Liberals needed to address those concerns before they imposed the tax, not after.
It's not just that 82 per cent of British Columbians oppose the tax, according to an Angus Reid poll. The poll found 64 per cent of people believed the Liberals were uncaring; a majority believed them to be dishonest.
And it put NDP support at 47 per cent of voters, far greater than the Liberals' 29 per cent.
Grim days for Campbell and company, especially for the Liberals who hoped to succeed him and are now tainted by the doubts about HST honesty.
Whether the HST initiative succeeds or evolves into a recall effort against vulnerable Liberal MLAs, the government faces a legitimacy crisis.
Footnote: Former finance minister Carole Taylor added to the Liberals' woes last week. She repeated her opposition to the tax shift on to consumers. And the "bigger issue," she said, is that the Liberals "promised that they would not - they would not - do the harmonization of the sales tax. And then right after the election, decided to do it."