This month, for the first time in B.C. history, every British Columbian has the chance to play finance minister for a day. HST referendum ballots have landed in mailboxes across the province. But not everyone is thrilled with the opportunity. Navigating the complexities of tax policy isn’t easy, and even the referendum question is causing confusion. Voting “no” means you want to retain the HST, which strikes many as counterintuitive. A “yes” vote, meanwhile, is a vote against the new tax. The last poll showed that almost 20 per cent of respondents misunderstood. And that was just the question.
Both sides of the debate—former premier Bill Vander Zalm’s Fight HST campaign, and the government and its allies, calling themselves the Smart Tax Alliance—are fighting hard, deploying TV, print, radio and Internet ads, automated “robo” calls, lawn signs and spin doctors galore in a last-ditch effort to pick up votes. Yet some British Columbians, grown weary of the din, are turning to more trusted sources: their friends, family and colleagues.
Vancouver writer Christine McLaren was so thoroughly confused, she decided to gather her informed friends for a party to try to make sense of the referendum. Despite closely tracking the debate, the self-described news junkie had “no idea” how to vote. A lot of her friends, including her housemates, a shiatsu therapist, and a yoga and meditation teacher, were equally stumped. So the trio invited pals from all walks of life—engineering, finance, the arts, a mix of low- and middle-income families—to their purple house in Strathcona, a gentrifying neighbourhood bordering the Downtown Eastside. By hashing out the arguments, and “picking each’s other’s brains,” McLaren hoped to help make the decision a little less, er, “taxing.”
Last June, B.C. “harmonized” its provincial sales tax with the GST, creating a single “HST.” This meant some things that hadn’t been subjected to both taxes before are now more costly to consumers, but the tax is meant to be a boon to business and the economy; it removes compounded PST, which had been charged at every stage of production, increasing costs.
But in B.C., the debate has, by now, devolved to a “screaming match,” says UBC economics student Colin Fraser. “All that people really understand is that haircuts and restaurant meals cost seven per cent more.” Fraser grew so sick of the rhetoric and misinformation that he wrote a long, thoughtful blog post last week, which has since gone viral, to help his friends understand the value-added tax.
“For the average person who hasn’t been trained to understand the effects of a shift in taxation, it’s confounding,” says McLaren. “You’ve got to consider whether corporations will be taxed less, and consumers more, and then if the HST doesn’t go through, whether corporations will choose to ship elsewhere.”
McLaren served tabbouleh, hummus and wine, to get conversation flowing at her party. She needn’t have worried. Within minutes, her first three guests were “screaming and yelling at each other.” Among the 15-odd guests, the pro- and anti-HST sides were evenly split, but more than a third were undecided. As a group, they went through Vander Zalm’s arguments opposing the HST one by one, fact-checking his figures with independent reports that McLaren printed out for the occasion. At that point, she says, the atmosphere shifted: “People were bouncing ideas across the room, thinking deeply, digesting the numbers and facts.” It felt like “going back in time” to the parlours of Paris or the ancient Greek polis, “when there was no Internet or newspapers, the only way you got information was by debating,” says the 24-year-old Penticton native. “It felt like democracy at its purest.”
For the past two weeks, informal gatherings like these have been taking place in classrooms, coffee shops, dinner tables, and on email. In a message last week, Toby Chu, president and CEO of CIBT Education Group Inc., which runs private colleges across Canada and Asia, told his friends and colleagues he was voting “yes” to extinguish the HST. The tax, he said, cost his company $500,000 last year, translating to “job losses, benefit cuts and reduced spending.” A day later, the chair of the Vancouver Board of Trade, Wendy Lisogar-Cocchia, fired off an email urging local business owners to “share the knowledge” of the HST’s “economic advantages” with their employees.
In the end, no one left McLaren’s party undecided, and a few minds were even changed. Ultimately, McLaren decided to vote “no” and keep the HST. In digging through the reports, she realized low-income earners would not be disproportionately affected. And the costly process of reverting back to the old dual system just wasn’t worth it.
With most polls showing a 50-50 split, it’s still far from clear whether the HST will survive the referendum. If there’s one thing both McLaren and Fraser are sure of now, though, it’s that citizens should not be making decisions like these; it’s too costly and time-consuming. “We trust our leaders to have an understanding of these issues, and make decisions in our interest,” says McLaren. “That’s why we elect them.”