The HST is more progressive than the alternative
I was not up in arms over the process which the HST was imposed on BC. Gordon Campbell was known by the electorate to be “liberal with the truth”, so there should have been little shock about the Premier denying the HST in April 2009 then implementing the policy after the election. Call me a cynic, but I don’t expect to ever be pleased with the BC Liberal’s steamroller-style of governance. So, ignoring the process, let’s take a look to see whether the HST is indeed terrible for BC.
First, the HST provides us with one set of rules/associated bureaucracy (opposed to two with the PST and GST), and a fairly large compensating payout up front for the harmonisation.
1. Cost savings (fewer tax inspectors/less regulation)
2. TWO BILLION DOLLARS
3. Profit (For BC’s treasury)
What’s not to like about 3? It leaves more money for social programmes, and other goodies social democrats like myself enjoy spending tax revenue on.
Second, the tax isn’t high. A rise of 7% on certain items isn’t too much - is it? The sky isn’t falling in England with a sales tax at 20%. For ideological consistency, those who rail against consumerism shouldn’t be upset with a rise in consumption tax.
Third, I sincerely doubt the BC NDP wants to jump on the populist anti-tax band wagon after a leadership election which replaced a centrist with someone decidedly more left-wing. I’m not saying Adrien Dix would raise taxes, but I’d be surprised if there weren’t “strategic modifications to BC’s tax code” should he form government.
So getting that the three points above of the way, I asked myself on which consumer goods and services does the HST increase tax? The brainwashed answer can really only come up with bikes and eating out. (The Stop HST froth is pretty much “process + more expensive nights out = HST is the devil spawn”). So, being fresh out of university, I went to the first-stop research location: Wikipedia.
Wikipedia has a page on Sales Taxes in British Columbia with a section devoted to which consumer goods and services will be taxed an additional 7%. Great, I thought, I can make an informed decision.
The list of goods and services now taxed at a higher rate can be divided up into three categories: discretionary, essential, and debatable. The classification process was reasonably quick. My once over the 57 item list of goods and services has 79% of the cancelled PST-exemptions as discretionary spending. Only of 12 of the 57 goods and services fell outside this classification.
For example, eating out and going to the movies shouldn’t be tax exempt. Nor should concerts, Canucks tickets, or beauty treatments.
I had an issue determining whether some items were discretionary or essential purchases. My internal debate with against/for is in the google doc spreadsheet “HST Increases List” tab in the linked spreadsheet below.
Aside from these bits which I can’t classify (and the 8 essentials I identified), I believe it’s fairly clear that the HST is more progressive on a “what is and isn’t taxed”-change basis.
In the end, the choice should be yours as to whether you support the HST (don’t just follow the party line).
To view my categorisations, and my pivot chart on the Google Docs spreadsheet click here. The items and categories were lifted from Wikipedia page http://en.wikipedia.org/wiki/Sales_taxes_in_British_Columbia
- andrewfergusson posted this