British Columbia: Now with less tax and more tax -

British Columbia: Now with less tax and more tax

Paul Wells on British Columbia’s tax cut that isn’t


We are now in a moment in Canadian politics where tax policy is based mostly on how people feel about different taxes. B.C. premier Christy Clark is now at the cutting edge of feeling-based tax policy, thanks to her decision today to cut the HST, hike the provincial corporate tax rate, and distribute cheques to some of her fellow British Columbians. Economists find every part of this notion vexing. On Twitter, Stephen Gordon linked to this old blog post explaining why Canada needs a lot more HST-ish taxing and a lot less corporate-tax-rate-ish taxing.

This is pretty nearly conventional wisdom among the wise. Colleague Coyne will surely be gallumphing along any moment to explain that the only way Clark could make British Columbians’ lives any worse would be to make them wear bicycle helmets all the time. But no matter. Clark has inherited an unpopular HST policy from her predecessor Gordon Campbell. Defeat in a referendum on the tax could blow a hole in Clark’s premiership before it really gets started. So she must be seen to be Doing Something. Cutting the HST, which looks to consumers like a tax on everything, looks popular. Hiking corporate taxes, which look to consumers like a magical kind of tax that no real person pays, looks painless.

I’m not sure it’ll help as much as Clark needs it to help. BC voters’ referendum options now come down to a choice between less HST and none at all. I think it just became easier to vote for “none at all,” because “as much tax as we’ve been paying” suddenly has no champion.


British Columbia: Now with less tax and more tax

  1. Well, the Liberals put themselves in a hole by bringing in the HST in such an underhanded and stupid way.  They then made it worse by promising a referendum on it.  Referendums on tax policy are a dumb idea (Exhibit 1 – California) since most people don’t have the background to make a reasonably informed decision.

    I’ll be voting to keep the HST, but the Liberals have made a complete mess of the whole thing.

    • Despite the underhanded way in which the Liberals brought in the HST, I, too, will be voting to retain it. Gordon Campbell did the right thing and fell on his sword for what he did, so my need for revenge has been satiated and I can thus look at the tax relatively objectively.

      – Just about every developed nation employs a VAT (including socialist Scandinavian countries where the VAT is very high)
      – The vast majority of economists say that a VAT should be the preferred way of obtaining revenues
      – The tax shift from business to consumer that would have occurred with the original plan will be history
      – Scrapping the HST means coming up with $1.6B to pay the feds back.

      I realize that I’m likely in a minority and the HST will be voted down, however, I just wish that the people voting it down were doing so for reasons other than partisanship and a dislike of the Liberals (and the sleazy way they brought the tax in). Sadly, from the comments I see here and elsewhere, that’s very much what is happening.

  2. I’m voting “yes” to scrap the HST. I don’t oppose the HST. I just want the BC Liberal party to explode. 

    • Kyle, in that case please vote to keep the HST, since it will cost us a lot to go back to the PST.  The HST really is a better tax for the province than the PST, so don’t hurt all of us just because the Liberals are dirtbags.

      • Sorry I don’t care anymore. I’ll even accept an NDP government at this point to wait out a true conservative party option in BC. 

        • Nose, face, spite.
          You may want to consider the relation there.

  3. “This is pretty nearly conventional wisdom among the wise.”

    Not that Liberals, or anyone else for that matter, will listen to me but I wish everyone would read Jim Manzi’s article in City-Journal from last year titled “What Social Science Does—and Doesn’t—Know”

    There is no conventional wisdom when it comes to economics and other social science fields, no matter what we think, and it has always been about how we feel about taxes. It all went wrong for western world whenever we decided – 40/50 years ago? – that social sciences were as sound as proper sciences and should be treated equally.

     “In early 2009, the United States was engaged in an intense public debate over a proposed $800 billion stimulus bill ……. 

    James Buchanan, Edward Prescott, Vernon Smith, and Gary Becker, all Nobel laureates in economics, argued that while the stimulus might be an important emergency measure, it would fail to improve economic performance. Nobel laureates Paul Krugman and Joseph Stiglitz, on the other hand, argued that the stimulus would improve the economy and indeed that it should be bigger. 

    Fierce debates can be found in frontier areas of all the sciences, of course, but this was as if, on the night before the Apollo moon launch, half of the world’s Nobel laureates in physics were asserting that rockets couldn’t reach the moon and the other half were saying that they could. 

    Prior to the launch of the stimulus program, the only thing that anyone could conclude with high confidence was that several Nobelists would be wrong about it.

    But the situation was even worse: it was clear that we wouldn’t know which economists were right even after the fact.”

    • Terrifying to think we have a social scientist as Prime Minister now eh?

      • Indeed.

        I read this article the other night – Fat City: Thank you, Illinois taxpayers, for my cushy life by David Rubinstein –  and it was quite funny and shocking.

        “After 34 years of teaching sociology at the University of Illinois at Chicago, I recently retired at age 64 at 80 percent of my pay for life ….

        But the discipline of sociology is so ideologically homogenous—a herd, as Harold Rosenberg put it, of independent minds—that this problem is rare. Universities cherish diversity in everything except where it counts most: ideas. 

        According to data from the Center for Responsive Politics, Harvard, donating 4 to 1 in favor of Democrats in 2008, was one of the more politically diverse major American universities. Ninety-two percent of employees at the University of Chicago donated to Democrats. The University of California favored Democrats over Republicans, 90 percent to 10 percent. And William and Mary employees preferred Democrats to the GOP by a margin of 99 percent to 1 percent. Neil Gross of Harvard found that 87.6 percent of social scientists voted for Kerry, 6.2 percent for Bush.

        Gross also found that 25 percent of sociologists characterize themselves as Marxists, likely a higher percentage than members of the Chinese Communist party. I would guess that if Lenin were around today he would be teaching sociology and seeking grants to fund the revolution.”

        • So your point is that those who give issues serious thought end up having liberal ideas, while those who give issues little or no thought end up with conservative ideas.  It’s appealing to see it so well documented. 

    • Very good article- thought provoking. Thanks for the link. 

    • Just because economists don’t agree on everything doesn’t logically suggest they don’t agree on anything, nor does it suggest there are “no right answers ever”.  That the social sciences are imperfect does not mean they don’t, at times, advance our understanding.  This is so, a fortiori, where a significant number of people trained in the area actually agree on something, which is often quite rare, and arguably the case on the HST.

      Wow, you have me defending the social sciences, Tony.  Hope you’re proud of yourself.

      • “Wow, you have me defending … ”

        Was it worth it?

        I think economists generally agree on theories like Laffer curve but devil is in details. When it gets to practical discussion – which rate should tax be set at – consensus disappears.

        What is crazy is that even after BC Government tinkers with tax rates we still won’t know which caused what effects because economics is imprecise and economists will be as clueless after as they were before. 

        “the Laffer curve is a theoretical representation of the relationship between government revenue raised by taxation and all possible rates of taxation. It is used to illustrate the concept of taxable income elasticity (that taxable income will change in response to changes in the rate of taxation).”

    • How we feel about taxes is a subject for political science. The some efficient taxes are unpopular doesn’t negate their efficiency is funding the desired size of government while minimizing harmful economic effects including inequality and deadweight losses.

      On the topic of the HST, it could be made a whole lot more palatable if it were included in the price of goods, as VATs almost universally are. It is a cognitive bias that we care a lot more about small taxes we see frequently (HST) more than big taxes we see infrequently (income tax when we file our return, or land transfer tax when we buy a house). We should be trying to design a society that yields good outcomes in spite of the cognitive defects of our human brains that were developed to survive on the African savannah, and not in complex financial transactions or unintuitive economic forces.

      • “We should be trying to design a society that yields good outcomes in spite of the cognitive defects of our human brain …. ”

        I can’t tell if you are joking or not – It is not tax code that’s the problem, it is humans that are at fault. How do you suggest we overcome our defects?

        If you are not joking, your cognitive impaired brain is causing to forgot thousands of years of history that suggests people are incapable of design societies that yield good outcomes.

        Less regulation = less discrimination. Good outcome. 

        Do you have example of designing society successfully? I have an example of failure. And there are many, many more.  

        “First Nations peoples face a number of problems to a greater degree than Canadians overall. They have higher unemployment, rates of crime and incarceration, substance abuse, health problems, fetal alcohol syndrome, lower levels of education and higher levels of poverty. Suicide rates are more than twice the sex-specific rate and also three times the age-specific rates of non-Aboriginal Canadians … ”

        Gary Becker – ” …. showed that discrimination will be less pervasive in more competitive industries because companies that discriminate will lose market share to companies that do not. He also presented evidence that discrimination is more pervasive in more-regulated, and therefore less-competitive, industries.”

        • Less regulation is always better? I’m sure you won’t mind when I built my spent nuclear waste reprocessing facility next to your house. All nicely wrapped up in a nice limited liability corporation. 

          Do you believe that markets never fail?

          Public education, public health, state pensions, etc. all seem to be things that improve human welfare. I’m not aware of any states that have achieved a high level of welfare without some or all of these.

          • “Less regulation is always better? ….”

            Not always, just most of the time. 

            If you believe most/all humans are racist, how can we design laws that are not racist? I believe in a few, well defined rules that every one has to follow and we all know what is expected of us.

            Examples of what I mean:

            1) “The resistance of southern streetcar companies to ordinances requiring them to segregate black passengers vividly illustrates how the market motivates businesses to avoid unfair discrimination. Before the segregation laws were enacted, most streetcar companies voluntarily segregated tobacco users, not black people …. Streetcar companies refused, however, to discriminate against black people because separate cars would have reduced their profits. They resisted even after the passage of turn-of-the-century laws requiring the segregation of black people.”  Jennifer Roback, “The Political Economy of Segregation: The Case of Segregated Streetcars.” Journal of Economic History

            2) When Nova Scotia’s Samuel Cunard founded his iconic ocean liner company in 1840, he had no idea that his massive ships would, in the period following the Second World War, become home to elaborate drag shows and some of the first gay weddings …. That this evolution of gay culture took place on the high seas is no accident. “Economic factors drove these companies to hire large numbers of gay men,” says Conlin. “Passengers enjoyed their witty banter and music shows. [The companies] would gladly turn a blind eye to sexual preference, for profit’s sake.” Macleans, May, 2011

          • You seem to be suggesting business is moral. It’s amoral. It’s equally conceivable that a restaurant, in absence of regulation, would enforce a ‘whites only’ policy to cater to a certain market. You provided examples of businesses floating morally questionable laws–they are just as likely to question morally justified laws if it serves the profit motive.

            So humans are not purely rational or purely irrational. We have a (mostly) rational conscious mind sitting atop an often irrational subconscious. When dealing with matters that are more abstract and remote, it is much easier for humans to be rational. Training in critical thinking helps.

            We design laws that are not discriminatory (in large part) by exploiting our disposition to be rational in the abstract. Hence the Charter of Rights and Freedoms. Removed from context, it sets out many quite rational principles, and this document helps to put guards against more context sensitive laws overstepping these principles.

            I agree that society should be lightly regulated, as it should only require relatively small, effective interventions to prevent bad outcomes.

            One example of hyperbolic discounting (in a choice between $10 now and $11 tomorrow, most would pick $10 today. In a choice between $10 a year from now and $11 a year and a day from now, most would pick the $11). This is irrational, and underlies the general failure to save. Many people are disposed to have the BMW today and eat dog food in retirement. This is the problem addressed in part by CPP. Without out it, we’d be faced with the choice of leaving old people on the street in poverty or fueling the moral hazard by giving them welfare.

            Interesting reading is ‘The Efficient Society’ by Joseph Heath.

      • On the whole, human beings want to be good, but not too good, and not quite all the time ~ George Orwell

        Andrew_notPorC – just started new window, don’t like how they shrink. Busy afternoon with work but enjoy this discussion.

        If that restaurant is in Canada, we would know who the racists in our midst were and that restaurant would quickly go out of business because few, if any, Canadians would patronize the place. I think it is better to know who the nutters are so we can punish them. If the nutters are forced to keep their opinions to themselves, we don’t know what mischief they are causing.

        I think Orwell came up with best one sentence description of people, we can be trusted Andrew_notPorC to do the right thing, eventually. Laws put our biases into effect, absence of them lets people pursue their happiness. Invisible hand is moral because people are moral.

        “This is irrational, and underlies the general failure to save.”

        It is not irrational if you need $10 today. Forcing people to do things that they think are irrational is not good policy, no matter what you might think of saving for retirement. Good process is better than good outcome.

  4. “We are now in a moment in Canadian politics where tax policy is based mostly on how people feel about different taxes.”

    Wells  – Read D Saunders column the other week arguing against corporate tax rates and I was outraged by his bias towards left.

    Right wing is against corporate taxes, not left, but Saunders writes about left wing argument even tho NDP want to raise corp taxes and workers, people with high school education, tend to vote Conservative.

    “But corporate tax, by its nature, has a reverse Robin Hood effect: It is regressive. Big corporations have no trouble avoiding it ….. In fat, the strongest arguments against corporate tax come from the left. They were most eloquently expressed by Robert Reich …. Corporate tax, he noted, is fundamentally regressive: It shifts wealth to the rich. And not just because General Electric avoids it and corner shops don’t. Since corporations do not physically exist, corporate tax is ultimately paid by individuals – and, as many studies have shown, those individuals tend to be the company’s workers more often than its shareholders or executives.” Globe/Mail, Apr 2011

  5. Everyone should wear bicycle helmets all the time, silly.  Otherwise, an accident could leave you with a serious brain injury and render you unable to work — except, perhaps, a Member of BC’s legislative assembly. 

    • Certainly Paul blew that one: the way to make his gallumphing colleague take notice would be to require British Columbians wear bicycle helmets and floatation devices while travelling on high speed trains through the mountains.  Note: Of course, courses in the proper use of head gear and floaties would be necessary before licenses to ride fast trains could be given out.

  6. Anything to please the Free lunch crowd!  You the Tea Party and their ilk “Cut MY taxes to nothing but leave MY benefits coming!  Cut the other guys benefits instead!”

    • The really strange thing about the whole HST schmozzle, though, is the strange bedfellows it has created.

      First off, the BC NDP has opposed not just the HST but also the Campbell government’s Carbon Tax.  That’s right — the socialist/greenie party is now the “we hate taxes” party.  And apparently they don’t care about global warming either.  But they do oppose run-of-river power projects because, well, because the Liberals like them and opposing them doesn’t upset the NDP’s union buddies.

      Then, hand-in-hand with the NDP in opposing the HST is former Socred premier Bill Vander Zalm, who was also essentially responsible for handing BC over to the NDP in the 1990s, because Zalm screwed up so badly in office.  It just boggles the mind.

      The ironic thing is that it’s the business community, by and large, that’s in favour of this tax.  To try to portray the anti-HST crowd as a tea-party like right-wing movement is highly misleading and misreads the nature of this movement.  It’s a combination of crass opportunism and classic populism.

      • Bruce Yandle – Baptists and Bootleggers: “a model of politics in which opposite moral positions lead to the same vote. Specifically, preachers demand prohibition to save souls and the bootleggers agree because their sales will increase.”

      • In fairness, the NDP’s opposition to the carbon tax was one of the dumb moves that contributed to the demise of Carole James as leader.  She didn’t make herself popular with anybody with that one, and I suspect the NDP will be back to supporting green tax initiatives in the coming election.

        • I think the reality is that the HST is so screamingly unpopular, it’s simply crowded out and overshadowed everything else, including the Green Tax.  If the NDP did shift their support over to it, practically nobody would notice, except for political junkies.  Everybody’s too busy knotting together nooses over the HST.

      • To think that the Tea Party is pro-business is really reading to much in their so called programme. I stand by what I wrote  ‘the Tea Party and their ilk “Cut MY taxes to nothing but leave MY benefits coming!  Cut the other guys benefits instead!”‘ They want no new taxes and the present taxes to be reduced but they still want their roads, schools, military, etc…  

        • You’re probably right about the US Tea Party types; but I maintain that the anti-HST forces in BC are very different from that group in terms of their composition, ideological outlook, and so on.  First off, although a lot of the anti-HST people are, frankly, too stupid to realize this, they really aren’t an “anti-tax” movement, since the only logical and feasible outcome of their campaign if it is successful is the re-imposition of the PST.  Which is, umm, a tax.  And a really lousy one at that.  Talk about a Pyrrhic victory.

          Secondly, one of the main components of the anti-HST coalition is the Provincial NDP, which is only in it for one reason:  pure, crass political opportunism.  I’m going to guess that you’ll agree with me that NDP leaders and supporters ain’t exactly Tea Party material.

          • I wouldn’t describe it as opportunism on the NDP’s part.  Opposing consumption taxes is consistent with their “stick up for the little guy” philosophy.  I don’t know how it works in other provinces, but people in BC are pissed off about the HST because it effectively raises by 7% the price of services (since those were PST exempt).  That ticks me off, and I’m a business owner.  It sure doesn’t make me feel good that the tax on a $5000 contract has now jumped from $250 to $600.  And although I technically get more money back on the input tax credit, I’d happily give that up to save the massive headache of accounting for 4 different tax rates in different provinces.  Whatever the miniscule savings end up being, it won’t be going to my clients.  It will be going to a professional book-keeper!

          •  “And although I technically get more money back on the input tax credit, I’d happily give that up to save the massive headache of accounting for 4 different tax rates in different provinces.”

            I’m confused, though:  how would your accounting task be any simpler with the PST in place?

  7. I feel very sure of death and taxes. What are the policy implications?

  8. Agreed.  This this was dead on arrival because of the way the Campbell government (mis)handled it.  The fact that Vander Zalm decided to go on an untrammelled ego trip, and the Province newspaper decided to join the jihad as head cheerleader, didn’t help either.
    I too will be voting to keep the HST, but it will be like voting for the Progressive Conservatives in 1993.  A lost cause.

    • And don’t forget all the misleading (and that’s putting it politely) information from Delaney and Vander Zalm.

      At least the two of us will be voting to keep it …

      • Regardless of what you think of the tax, it’s shameful both:

        1. how the Liberals did nothing to form a communications strategy at the beginning (and thus left a complete void that was enthusiastically filled by the tax’s opponents); and

        2. how the HST opponents got puffball, completely uncritical coverage by the media, especially the Vancouver Province, which immediately painted the tax’s opponents as these modern-day heros.  It was disgusting, one of the most shameful examples of media bias and abdication of responsibility I’ve ever seen.

        • Agreed, the Fight HST “study” is full of half-truths and quotations taken completely out of context and the media don’t seem to be calling them on it. 

          But the whole thing is a fiasco, the Liberals shouldn’t have brought it in the way they did and we shouldn’t be having a referendum on it.

  9. Having to wait over a year for a percentage drop just proves handing tax control over to Ottawa was a big mistake. Anyone without kids will have paid HST for 3 years before they get any kind of break. I for one will vote Yes to kill the HST unless 2% can be dropped immediately….put some pressure on Harper to make the changes now.

    • Please reconsider your decision.  The HST really is a better tax, unfortunately its benefits aren’t nearly as obvious as the tax increase on services and other previously non (PST) taxable items.  Also, we (collectively) as a province are going to end up paying an awful lot if we bring the PST back since we’ll owe the feds the 1.6 billion they gave us for instituting the HST and we will have to collect the PST ourselves.

    • Oh, sure. For bicyclists…

      • Nice one.

        That’s right — the thin edge of the wedge . . .

  10. This is quite the study in contrasts. Why isn’t there a huge outcry in Ontario? Can it really be reduced to the inability of Campbell to properly implement it? Or are BCers generally more intolerant about taxes?

    • Ontarians know what it takes to run a govt.

    • Ontario doesn’t have the referendum option that we have.

      Also, their implementation wasn’t nearly as big of a cluster f**k as it was here.  I would have to think that if the BC Libs had introduced income tax cuts at the same time (instead of dropping the HST rate as a last ditch effort to save it) and pitched it as a “we’re moving from income taxes to consumption taxes, and here’s why it’s a good idea” move, we wouldn’t be in this mess.

      • Yes, but that would have required the BC Liberals to have a communications strategy.  And they didn’t.

        Also, in reply to Emily, there is also a populist tradition in BC politics which is not there in Ontario (I’ve lived in both provinces).  The last time I saw this in spades was around the time of the Charlottetown Accord in the early 1990s.  This group of angry people who called themselves “Friends of British Columbia” got organized and basically killed the Charolottetown Accord in BC.  Every once and a while, people in BC want to get really angry about something and stick it to The Man.  The Social Credit party may be history in BC, but its severe populist roots remain, witness Vander Zalm at the head of the anti-HST forces, and John Cummins heading up the new BC Conservative Party (whose singular accomplishment will be, as with BC Reform in the 1990s, the election of a BC NDP government via vote-splitting on the right).  Note to Zalm — thanks for the socialism.

        • Quite true…Ontarians don’t have the American tea-baggery horror of taxes that BCers do…or Albertans for that matter….plus we have a bigger population. Bigger population, bigger geography….so we know it takes bigger money to run it.

      • I”m no fan of McGuinty, and think the switch to HST is far and away his best policy.  He also looks like a masterly politician compared to Campbell on this file.

        As a business owner, I’d still take the higher CIT tax with lower HST over returning to a higher PST.  PST is the worst tax of them all, although payroll taxes are no treat.

        Clark’s proposal seems destined to last only a single news cycle. Surely the obvious conclusion is that a PST shift to CIT is equally possible (although not preferable IMO).

        • To be fair to Gordon Campbell (and he did badly mishandle this, no question), Ontarians have a passivity when it comes to matters like this that British Columbians don’t have.  Ontario, generally speaking, does not have the populist political tradition that BC has.

          One problem that any anti-HST forces in Ontario faced was lack of a truly popular leader.  The anti-HST forces in BC were well-organized, media-savvy, and they had Vander Zalm, who had charisma and the unique luxury of being utterly unconflicted, being a retired politician.  Lots of ordinary folk in BC (especially in the valley and the interior) still love Zalm, though the elites always hated him.  But that was almost to Zalm’s advantage on this one, because it fit the narrative of the angry righteous masses versus the arrogant elites. 

          Compare Zalm’s situation to that of Tim Hudak, who, as leader of the official opposition, actually had to measure an anti-HST position with considerations such as what would he do as an alternative if he got into power.  Hudak actually had to face tough questions about real policy choices and costs.  Vander Zalm faced no such questions from an extremely uncritical media.

          • I think in Ontario we also have an awful lot of people who recognize the value of the HST, to business and to the government.  And a lot of us also recognize that we don’t have the cash flow we used to have, and the money has to come from somewhere.  And I think a lot of us also realize we aren’t just taxpayer’s but also debt holders–we own the provincial deficit and debt just as much as we own our credit card debt and mortgages.

            But I ALSO think that many Ontarians are going to be watching for these (mythical) price reductions from the businesses that have seen their corporate tax rates reduced, their expenses reduced as they input tax credit some of it away, and the abolition of those ‘hidden’ taxes on certain goods that they used to have to pay.  And when they don’t materialize, a lot of Ontarians are going to remember that, and vigorously oppose any more tax breaks for business.

    • For one, the main opposition hasn’t been dumb enough to run against the HST. HST is good policy, and if Hudak intends to be premier, promising to kill it would make his life a lot harder than it needs to be.

  11. Also, for people who are, you know, genuinely interested in the HST debate – as opposed to just defeating this or that political opponent – I have it on good authority that this video is both entertaining and economically literate:

    • I can’t go through the whole youTube discussion, but if I have one element of the synopsis correctly, it is a slightly emotional, and strongly illogical (in the formalist sense) presentation: Instead of parsing out the HST component, which his source correctly identifies as slightly ‘regressive’, he lumps it, as with the source, with the entire tax framework.
      That is not the issue. The issue is whether the HST is wrong. It is wrong for the disadvantaged, and it doesn’t take much wrong for the disadvantaged for it to be plain wrong.

      • Are you kidding me? Danny, watch the video already, because you clearly didn’t.

        I’ve rarely seen such a straightforward and clear analysis from a regular member of the public.

        The HST is fair, efficient and lowers the cost of doing business, which cannot help but lower the cost of goods and services in the future relative to the current tax system.

    • Best youtube video I’ve seen in quite some time. Cheers.

  12. Strange policy,

    Unlikely to win any converts from the HST  haters, and very likely to make enemies out of Corporate Tax haters.

    Haters gonna hate. 

  13. It’s true that low corporate taxes are now conventional wisdom among the ‘wise.’ We are required to do this (we’re told) by the logic of the global/continental free trade, which demands ‘competitive’ corporate tax rates on threat of capital flight. This means that ordinary citizens have to bear an ever-greater share of ther tax burden (or else slash social services): hence, the HST, GST, etc.. The unavoidable – and generally unstated – conclusion is that the whole model of economic globalization amounts to a system for ripping off the poor and middle classes while relieving corporations of any obligation to the societies in which they operate. When you further consider that (according to StatsCan) middle class median income has increased by 0.1% since 1983 – grotesquely inferior performance to the 30-year-period that preceded it – and there’s no other conclusion but that the dominant economic model of our era, globalization and capital mobility, has been a disaster for everyone save the very wealthy and the corporations.

    • But I don’t know if the experience in Scandinavian countries bears out your description there.  Scandinavian countries are among the most egalitarian and progressive in the world, yet they tend to have extremely high consumption/value-added taxes, along with “competitive” corporate income tax rates.  The last time I was in Denmark a couple of years ago, I believe the VAT was something like 26%. 

  14. The HST will be necessary to pay for the 140 megabucks over 5 years for the new chipped CareCards.

    The new chipped CareCards being necessary to fight the 10 megabuck card-component of B.C. medical fraud. As Stockwell Day assists in turning the Liberals into a branch office of the Government of Harper, all this mysterious fiscal conservative logic will gradually metastasize into our stupid, Luddite, Western Canadian brains.

    We just don’t understand why presenting our standard CareCard along with a driver’s license/BC ID, wouldn’t suffice. I mean, that’s similar to the 2-ID thing I did for the last election.

  15. I will vote against the HST on the weight of the evidence correctly cited by Oleg’s link, but for which I just have the gist: that the HST solus is a regressive tax with respect to the poor.

    Whether the whole tax framework, including some form of HST, will amount to to a progressive tax with respect to the poor is a complex exercise I will leave to the ‘rising tide lifts all boats’ school of theoreticians.

    • Without getting into arguments about whether or not the HST is regressive I think its worth pointing out that if you believe that HST is a regressive tax and that income tax is progressive then you should also believe that PST is regressive.

      So your choice is between two regressive taxes.  Of the two HST is going to be better for the province.

    • You can’t seriously be suggesting that you prefer the PST? Based on you arguments concerning “the poor” one would think you’d either automatically prefer the HST or be calling for a complete removal of any sort of so-called regressive tax.

      The PST compounds at every level. The HST doesn’t.

      That alone makes the PST more expensive to the poor.

      The HST comes with a rebate based on income. The PST doesn’t.

      That alone makes the PST more costly to the poor.

      Seriously guy, I’m not understanding where you’re coming from on this.

  16. I’d be on board with reducing corporate taxes if we would also take steps to increase accountability of corporate officers and limit the legal rights of corporate entities. Corporations claim most of the legal rights of citizens, freedom of expression for instance, but limit liability to the point where no one is accountable for external impacts (e.g. economic, social, environmental). Shareholders seem unwilling or unable to induce corporate responsibility so we either need to regulate heavily, which I suspect the economists would also argue with, or extract a social payment to mitigate their impact on our communities.

  17. The real issue is that the thing was sprung without warning after (before the election) Campbell said they wouldn’t and it was one of the first things done after the election.  The only other issue is that the HST taxes items that the PST didn’t. Since the alternative to the BC “liberals” is the NDP, I’ll vote to keep the reduced HST (i.e an effective reduction in the provincial tax, since the feds aren’t yet lining up to reduce the basic GST again.)

  18. “BC voters’ referendum options now come down to a choice between less HST and none at all. I think it just became easier to vote for “none at all,” because “as much tax as we’ve been paying” suddenly has no champion.”

    Not “none at all”: the choice is between the HST and going back to the old PST and GST system. And as of now, it’s a choice between a 10% HST and a 12% PST and GST. As long as British Columbians want health care, education, and cradle-to-grave services provided by government (as opposed to the private sector), they will have to pay for it through general taxes.

  19. For me the issue is not the HST – I think it is a better way of dealing with two ad valorem taxes like the GST and the PST. The economic aim of reducing tax on exported materials is beneficial.  The real issue is that Campbell said publicly before the election that he would not impose the HST and then did after the election. The secondary issue is that some items that were not taxed by the PST are now taxed by the HST and that can be hard on low income families.

    I am not with those lefties that say we must tax more to give services which most do not need.