The protest against a harmonized federal-provincial sales tax in B.C. is gathering steam as NDP Leader Carole James heads into strong Liberal country to meet with business owners opposed to the tax and B.C. restaurateurs meet with provincial Finance Minister Colin Hansen.
Several online petitions have collected thousands of signatures of those opposed to the 12-per-cent harmonized sales tax. Disgruntled taxpayers are also talking about organizing recall campaigns against at least eight Liberal MLAs. If successful and the NDP won subsequent by-elections, that would wipe out the Liberal majority achieved in the provincial election only three months ago.
The flurry of anti-tax activities, expected to continue throughout the week, is a preview of what's in store for the government during the fall session of the legislature, which begins next Tuesday."People are feeling so angry right now; the anger, in fact, is building. … I haven't seen this kind of anger in a great number of years," Ms. James said yesterday in an interview shortly before travelling to Kamloops, where two Liberal MLAs were recently elected.
"It's been a hot summer, and I think that summer is going to continue into the legislature," she said.
The 7-per-cent provincial sales tax in B.C. will be combined with the 5-per-cent goods-and-services tax as of July 1, 2010. The tax change means consumers will pay more for a lengthy list of goods and services that are now exempt from PST, such as haircuts, school supplies, taxi rides, ski passes, phone bills and restaurant meals.
Mr. Hansen said yesterday that the government will not back down on the tax changes, regardless of the protests. "You cannot design a tax system based on a popularity contest," he said in an interview. "This is a very necessary thing for B.C. to do."
By next July, Ontario and the eastern provinces will have a harmonized tax system, Quebec will have a parallel system and Manitoba is seriously looking at signing onto the HST, he said. "Quite frankly, if B.C. was to not get on board, we would be at a huge competitive disadvantage," Mr. Hansen said.
But Mr. Hansen insisted that he was "totally open-minded" to suggestions on how to mitigate the impact of the tax. "It's going to have impact … and that's why we said to [the restaurant]industry, let's sit and talk about what we can do to mitigate it."
He dismissed a suggestion that the Liberal government had deceived voters by not talking about the tax changes during the election campaign. The proposed changes were unveiled on July 23, 10 weeks after the Liberals won a third consecutive term in office.
Ontario announced its shift to HST on Mar. 26, on the eve of the election. The Ontario announcement created some urgency for B.C. to move, he said. He sat down with Finance Ministry officials for the first time to talk about the HST days after the election. Legislation eliminating the PST system will likely not be ready until the spring session, he said. "I'm not promising anything for this fall. It depends how far we get into the drafting process. But it certainly will be all done by July 1," he said.
Ms. James said opposition to a tax increase has been fuelled by feelings that the Liberals were not transparent during the campaign. "People feel that we went through an election, there was an opportunity for the government to put this on the table to tell people they were bringing it in, and they didn't. So people feel deceived," she said. No one except Premier Gordon Campbell and Mr. Hansen believes the government considered and approved the tax in the weeks since election day, she said.
Many people have become cynical about politics and politicians, and feel powerless to do anything about it, Ms. James said. Her anti-tax tour this week, which includes stops in Prince George, Surrey and Vancouver, is an attempt to appeal across political boundaries and give voice to those people opposed to the tax, she said.
The Campbell government has previously backed away from initiatives after they were announced, she said, referring to the government's reversal on a decision to privatize the Coquihalla highway after vocal opposition from Kamloops and elsewhere.
Ian Tostenson, president of the B. C. Restaurant and Food Services Association, an advocacy group representing restaurant owners with about 180,000 workers, said the trade association has been "flooded" with comments from consumers opposed to the HST. Restaurant owners anticipate that the tax will result in less business. At a round table discussion last week, every restaurant owner indicated they had included fewer employees in their business plan for next year as a result of the HST, he said.
The industry is not opposed to the tax, only the timing, he also said. "We understand the bigger picture, but it comes down to a question of timing," he said, adding that he would like to see the government consider phasing in the tax over a number of years. "Consumers would adjust to a tax increase over several years," he said.