Raj Chouhan
MLA for Burnaby-Edmonds and opposition labour critic
Question: If British Columbians reject the HST, we will have to pay $1.6 billion for breaking the tax deal with the federal government and $85 million annually in interest. Doesn't that mean less revenue for social services that your party has traditionally prioritized?
Answer: Federal Finance Minister Jim Flaherty said that he is willing to negotiate on the timing and the amount of the repayment of the $1.6 billion payoff from the federal government. Considering the tax burden has shifted from business to families by $1.9 billion per year under the HST, even if the $1.6 billion the federal government gave B.C. was to be repaid in full, families will still be better off returning to the GST/PST system with all of its exemptions. In addition, Premier Christy Clark's promise to lower the HST by two points will blow a $1 billion hole in the annual budget. This will have a far bigger impact on the provincial bottom line and our ability to deliver social services than the combined cost of a one-time return payment to the federal government and any loss of annual revenue associated with a return to the GST/PST system.
Q: Based on the consumer price index, economist and SFU professor Jon Kesselman found that the HST resulted in a 0.6 of one per cent increase in overall consumer prices in B.C. and that the HST was a modest increase and not a "tax grab." What do you say to this? A: Under the HST, families are paying $1.9 billion more a year, every year. That money is being taken from the pockets of families and handed to big businesses who are already carrying less than their fair share of the tax burden. New Democrats oppose the HST because it is an unfair tax that hurts families and fails to invest in services like health care and education.
Q: HST supporters claim that harmonization is more efficient than the GST+PST system. Why go back to the old system?
A: The HST is not just a simple streamlining of our taxation system, it is a $1.9 billion tax shift on to the backs of B.C. families. There are other, better, ways to simplify our tax system that don't make families, whose budgets are already stretched thin, pay hundreds more per year.
Furthermore, the PST allowed the province to exempt items like bicycles and energy-efficient appliances -giving
families a break on sustainable purchases. British Columbians gave away the ability to make those choices by handing off provincial taxation authority to Ottawa.
Q: The 12 per cent HST means people pay full tax on things that were previously PST exempt under the old system. If the Liberals drop the tax to 10 per cent over the next couple of years, won't consumers save more with a two per cent tax cut on everything instead of a seven per cent increase on selected items previously PST exempt? A: The B.C. Liberals have proven they simply can't be trusted to keep their promises, and even if they do go to a 10 per cent HST, British Columbians will have been paying seven per cent more on hundreds of items for over two years, and they will continue to pay five per cent more on hundreds of items and services. Finance Minister Kevin Falcon has also refused to commit to maintaining the HST at 10 per cent, and British Columbians have no reason to believe that the Liberals wouldn't simply raise the tax again.
Cutting the HST will also blow a $1 billion hole in the budget which will end up being paid by families through increased taxes like MSP premiums and cuts to important services like health care and education. Families don't come out ahead under a 10 per cent HST or a 12 per cent HST.
Q: You stated that with the HST British Columbians pay more in consumer prices and get less money for health care, education and other services. How so? A: The HST adds seven per cent tax on to hundreds of goods and services that previously had zero provincial sales tax, including many schools supplies, restaurant and grocery deli food, a morning coffee and muffin and big ticket items such as new homes, renovations and a new roof. British Columbians also pay more for nutritional supplements, acupuncture and other complementary health services.
British Columbians get less because Christy Clark's plan to drop the HST by two per cent will blow an annual $1 billion hole in the budget that Clark herself said would have to come from heath and education services. Instead of properly funding services for British Columbians, the HST is a $1.9 billion tax shift onto the backs of B.C. families.
