HST struck down: now what?

By Karen Aney (The Cascade) – Email

Date Posted: September 15, 2011
Print Edition: September 14, 2011

Now that the result of the referendum has been made official, a reported 54.7 per cent of the British Columbians who cast a ballot are celebrating the loss of the Harmonized Sales Tax (HST). Though the change back to PST and GST could take up to 18 months, democracy has spoken, and the Liberals have pledged to respect the decision of BC voters.

There were reported advantages and disadvantages to both sides. Under the HST, small-business owners were beginning to see promising benefits. One such owner in Abbotsford, who wished to remain anonymous, claimed that he/she has already seen profits since the HST was introduced. When asked if those profits would be reflected in reduced costs to his/her consumer, the respondent stated: “No. With people being so broke lately, I couldn’t raise prices at all. The market was too competitive. The profits I’m seeing are acting as kind of a back-end raise for me.” Studies conducted on the HST’s effect on other countries have shown a marked decline in consumer costs, but no such effects have occurred yet in British Columbia.

The referendum itself was not without controversy. Claims that this was a poll of “the ignorant and the non-ignorant”, as tweeted by one HST supporter, were echoed far and wide. Accusations that the method of voting was far from effective – as the mail-in ballots were sent in conjunction with a rotating strike at Canada Post – seemed to be reflected in mass expressions of frustration from citizens unable to vote.

One caveat of the strike-down of this tax is that the province of BC is now required to pay back the $1.6 billion loan it received from the federal government with the purpose of instigating the HST. Despite the argument that many British Columbians never asked for this loan, Federal Finance Minister Jim Flaherty stated that there will be no leniency: “I’ve discussed the issue more than once with the minister of finance of British Columbia [Kevin Falcon] and I’m satisfied B.C. will honour the terms of the agreement that we have with the province.”

Including this sum, Falcon has estimated that the cost of returning to the PST/GST system will come to a total of $2.2 billion in the next year alone, with an estimated jump to $2.8 billion by the time the changes have been permanently implemented. To put that in perspective, examine it alongside another political issue in BC at the moment: the impending teacher’s strike. One of their demands is for smaller class sizes; Education Minister George Abbott has stated: “… to reduce every class in BC by one student it would cost us $150 million”. Translation: $2.2 billion could buy some pretty small class sizes.Less people voted in the HST referendum than in the most recent provincial election in 2009. According to Statistics Canada, out of an estimated 3,238,737 eligible voters, 1,610,125 voted for the HST referendum. 1,640,542 voted for the provincial election. The question, then, is regarding what happened to the extra 30,000 voters, as the passionate demonstrations seem to suggest a lack of apathy.

Reducing the scope of examination to one electoral district can prove illuminating. In Surrey-Whalley, a district known for low response rates and low income, 15,887 people out of 32,918 people voted for the recent referendum, giving them a response percentage of approximately 48 per cent. In the 2011 Census, conducted this past summer, response rates in that same area were at approximately 32 per cent percent before census employees were deployed to obtain more forms. Like the 30,000 voter gap, this 16 per cent response drop could possibly be attributed to disdain for the census – but the higher response rate could also reflect the importance British Columbians placed on the referendum.

UFV student Maria Gabor-Martinez was one of the frustrated voters who couldn’t voice her opinion. “I didn’t because I never got my [package], so I couldn’t send it in,” she said. The other members of her household all received their voting packages and were able to vote. Another student, Will Olthuis, offered an alternate explanation for the lack of citizens who voted: “I was planning on it, but I didn’t end up doing it. I filled out the card, I just couldn’t decide which way to vote. I looked at both sides, I read the articles. With the short term and the long term effects, I wasn’t really sure. Who really is?”

One burning question: who’s going to be paying back the $2.2 billion? In a public statement from May 25th, Finance Minister Kevin Falcon declared that, if upheld, these funds would be recovered by a temporary increase to corporate taxes from 10 per cent to 12 per cent. Will a similar method be employed to help recover some of the deficit? Olthuis didn’t think so. “I know who it will come from,” he declared. “The taxpayers.”

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6 Responses to “HST struck down: now what?”

  1. Jeff says:

    … why is this a news article?

  2. Michael says:

    You’re going to need to expand on your quibble, Jeff.

    This is a news article because it is reporting on an event that happened. The author’s view, which would make it an opinion piece, is not expressed in the writing. It is a report of verifiable facts that also incorporates interviews with people relevant to the topic at hand, in this case politicians and voters.

    If your bewilderment is due to the fact this is not a terribly recent development, remember that The Cascade is firstly a print publication, and that there was no issue for the week between orientation week and the first week of classes at UFV. We didn’t want to ignore this important bit of news just because we’d be behind the 24 hour internet and cable-fueled news cycle reporting on it.

  3. Paul says:

    …so why is this a news article? And what’s a “quibble”?

  4. Paul says:

    But well played Michael. I appreciate your professionalism

  5. Jeff says:

    Well, I think the other’s view is expressed in this piece. Anyone that took the basic journalism classes that UFV offers would know that citing anonymous sources more than once (a tweeting HST supporter is still anonymous) does express an opinion.

    Re-read the article Michael. One does not need to say “I think this” to express an opinion. There’s such a thing as one-sided news. Or did you not realize that?

    But that’s not my problem. At the end of this, I’m just saying “So what? I’ve read all of this before, and it was covered better in the Province.”

  6. Michael says:

    I can see the point you’re making Jeff. I can’t comment with intimate detail on the sources/one-sided issues you have with the article, as I did not write the piece. For that I would suggest using the e-mail link at the top if you wish to contact the author.

    I agree too that The Province covers a lot of things better than we do. The thing is, that while we do always try to hold ourselves to a higher level of journalistic quality than where we currently are at The Cascade, certain unchangeable factors are at play. For one, The Province has the resources and the talent pool to offer more extensive, more learned writing than we do. Those writing for The Province have a much deeper level of experience not only writing but writing in their specific fields. Here at The Cascade, due to it being a student newspaper, there will be a much lower amount of experience and a higher degree of turnover as people leave for other institutions or finish their degrees. It’s just a simple fact that a student newspaper cannot be expected to offer the same level of reporting and writing as one of the highest profile newspapers in one of the largest cities in the country. We at The Cascade are always trying to give our best efforts each issue, but the wisdom and development of writing talent that comes with years of experience cannot, due to the very nature of where the publication is based, be a staple of our writing.

    Thank you for your readership and comments, which are appreciated, Jeff. It sounds like you’d probably have some good ideas on how to improve the paper: if you’re ever interested in contributing to The Cascade, we’re always open to new angles. Our weekly writer’s meetings are held Mondays (Tuesdays if the Monday is a holiday) at 9:15 am in room C1429.

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