Friday, August 26, 2011

After the HST, government needs a clear plan

OK, the HST is gone. Now it’s time to get things back on track.

For more than two years, things have been a mess in B.C.

Politically, we’ve had a citizens’ revolt, the resurrection of Bill Vander Zalm and the ouster of Gordon Campbell.

Economically, we’ve been a mess. Tax policy has been made up on the fly. Campbell promised a 15-per-cent income tax cut, then the government reneged once he quit. The government cut corporate taxes, then Premier Christy Clark said she would increase them again if the HST survived. The Liberals said the HST was not in the plans during the 2009 campaign, introduced it, then watched as it grew increasingly doomed.

All at a time when the economy was already fragile.

Businesses, and individuals, adapt to different tax regimes. But they like certainty. If a corporation is going to invest $100 million in a mill, it wants to know that the taxes won’t suddenly change once the doors are open. If a family is going to spend $10,000 on a new roof, they want to know that waiting for the result of the HST referendum wouldn’t save them $400.

That’s been missing.

And, despite the referendum result, certainty is still missing.

No one knows what happens next.

Finance Minister Kevin Falcon has said the government doesn’t have to bring back the old provincial sales tax, with all the exemptions were in place in 2009. He said the tax could be more like the HST, applied to more goods and services, to increase revenue.

Health Minister MIke de Jong has taken the opposite view. He told Mike Smyth of the Vancouver Province that the petition and referendum questions were clear.

“The choice is the HST as it exists today, or the PST as it existed previously,” he said. “If people opt to get rid of the HST and go back to the PST as it existed in 2009, that’s what the government is going to do.”

De Jong is right. But until the government is clear, the tax uncertainty continues. And so does the risk of another taxpayer revolt, if the government tries to weasel on the referendum result.

Falcon appears, in the aftermath of the vote, to accepted that reality.

That’s just one issue in the post-referendum world.

Falcon has said that rejecting the HST would mean big changes for B.C.’s budget.

It’s time for the government to lay those out for British Columbians.

The defeat of the HST means about $360 million less in annual revenue, according to the analysis by the government’s independent panel. The federal government’s $1.6 billion incentive payment to encourage the province to adopt the tax has to be repaid over time. The PST tax office has to be restored.

So what’s the plan? Will taxes rise, and if so, who will pay more? Will spending be cut, and who will lose out? Or will the government borrow more to repay the federal government, and accept the interest costs?

They are all legitimate responses. What’s needed is a clear, multi-year government plan, so everyone, businesses and investors particularly, know the rules.

And so voters can decide whether it makes sense.

A serious government would be setting out its plan, accepting the public’ verdict.

Instead, it seems the Clark government is still considering a quick election.

That’s just irresponsible. There is no clear election issue. The Clark government hasn’t set out an agenda, or a prudent budget based on the HST referendum results.

Clark has a chance to set out her government’s plans and priorities, supported by a new budget in February. That would let voters make an informed choice.

It’s been a more than two years of stumbling government and slapdash fiscal policy in British Columbia.

Clark needs to show what alternative her government has to offer before Britisn Columbians go to the polls.


Scotty on Denman said...

YES, there IS a clear election issue: because the BC Liberals are dishonest, they'd be the last to admit that if we keep following them down the path they have been leading us on, the public weal will be all the more wrecked and all the harder to fix once they've been turfed. This materially affects everyone. BC Liberal policy has been bad for BC and certainly much worse than the previous ten years of NDP rule. The issue is that the government is probably irredeemable and the economy will suffer even more the longer they are in power. Dishonesty is at the root and will be one of the overarching issues whenever an election is called.

DPL said...

Anyone who listens to that ass, Falcon needs to give their head a shake. The Premier said a number of times today that all the previous PST exemptions will return. He lives in a different universe. The BC Liberals have screwed up the economy following right in line with El Gordo. So he left a mess, but got a good job somewhere else, leaving the sheep to mill around not knowing what to do next.

Anonymous said...

Harper, Campbell and Hansen colluded on the HST long before the BC election. They used very dirty tactics to steal from the BC people.

Harper rewarded Campbell the lowlife, with a cushy High Commissioners appointment in England. Shame on Harper, for embarrassing Canadians, yet AGAIN.

Canada is a cesspool of corruption, because of Harper. He has fouled and dirtied the good name of this country. Lying to Europe, trying to sell the filthiest energy in the world, as clean energy.

The worst, most despised, corrupt, evil politician in Canadian history, gets to go to London, to scam Europe into buying, the dirty tar sands oil.

The Campbell/Clark BC Liberals have stolen from the BC people for over ten years now. Campbell twice lied, to be re-elected, for two different elections. One lie, the HST wasn't on Campbell, Hansen's and Harper's radar. The BCR wasn't for sale either.

It is this kind of evil, of thieving, deceiving, corrupt, lying politicians, that causes citizens to riot. The citizens of the world, have had enough.

Anonymous said...

PW wrote: we’ve had a citizens’ revolt

Semantics count.
I prefer: citizens' rights affirmation ritual

Anonymous said...

The vote against the HST was a virtual landslide, and that was after the Campbell/Clark Liberals spent tens of millions of tax payers dollars in a one-sided propaganda campaign intended to deceive and obvuscate. Add tens of millions more in ads paid for by the business fraternity. If they hadn't colluded, lied, and cheated to the degree that they did in their misinformation campaign the above would have been completely wiped off the map. At least there were some temporary jobs created in the advertising industry by the HST.

It's odd that the government that has no money for important services, so quickly and easily found those tens of millions in spare cash to fund a one-sided "No" campaign. It astonishes me to realize that there are still British Columbians out there ready to cling to a futile hope that the Campbell/Clark Liberals would ever do anything they promised when it suits them better, politically, not to. Who wants to do honest business with the likes of them anyway? Ughh.

I'm thinkin' that Christy Clark and her minions have some serious 'splainin' to do with their corporate sponsors. They just watched their $2Billion per year freeby evaporate in front of their eyes.

The Golden Decade.

Raymond Graham

Keith said...

Anonymous @ 10:19 wrote,

"I'm thinkin' that Christy Clark and her minions have some serious 'splainin' to do with their corporate sponsors. They just watched their $2Billion per year freeby evaporate in front of their eyes."

Don't believe for a second that the corporate sponsors will let
2 billion evasporate, dollars to doughnuts they is a plan "B" ready to go, additionally the liberal government will still be raking in approx. $840 million per annum until March 2013 on a "revenue neutral" tax. I can't see our current elected money grubbers letting that go.


piker said...

I get a chuckle whenever I hear about the stories of corruption with Kwantlen Student Association played endlessly on the CKNW newscast. It reminds me daily that both Christy Clarke and Kevin Falcon learned their political dirty tricks while "studying" at SFU.
Both of them treat provincial politics with same pettiness and utter stupidity as when they "played" politics with student funds. Only now, the whole province suffers.

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