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The Silver Lining in B.C.'s HST
| Image: iStock | Published: July 06, 2010
Hysteria aside, B.C.'s HST might make people
more intelligent consumers.
We’re five days into the HST and it’s my fervent hope that the noise around it may make people in B.C. actually consider a little before they blindly buy things.
I suspect most people had a rollicking good time signing their petitions and attacking the government(s) who brought in the HST on July 1. Of course, the world didn’t fall apart, as many of the anti-HST zealots indicated it might. Despite the sturm and drang stirred up by the zealots, people weren’t suddenly plunged into poverty.
That’s because the HST, when all is said and done, is a consumption tax that has always been there in most cases. It was just so familiar most people didn’t notice it. Now that it has a new name and, yes, is being added to some purchases that previously weren’t taxed, people may actually start noticing it and change their bad habits accordingly.
Of course, this possibility was rarely mentioned in the anti-HST hysteria. Instead, people seized on the one or two things that would now be taxed, added their existing prejudices to the issue, and blindly lashed out at anything and everybody who might have had one good word for the tax.
So you get dumb statements like the one from a person who posted on the Globe and Mail website. The HST, he (presumably it was a he) opined, is “a payoff to Campbell’s big business backers for the past favours of corporate tax breaks, PPPs, selling off public assets and so on.”
So, let me get this straight. The HST isn’t simply a realigning of a tax system that didn’t make much sense in the first place—it’s part of an entire (and entirely stupid) conspiracy by Premier Gordon Campbell to screw the little guy, who, of course votes in the government?
Sorry poster, but that’s not only absurd, it's pure misinformation put out there by leaders of the anti-HST forces – an unholy alliance of extreme right wingers and extreme left wingers, ex-politicians who see a new opportunity to get into the limelight, and anyone else who is trying to either throw out the government (and take over themselves) or just stir up the population because … well, they just like to stir stuff up.
The PST was an unfair and cumbersome tax, period. It screwed the little guy and big business with equal gusto. And it created an out of control bureaucracy that now, blessedly, will be jettisoned and thereby save taxpayers about $160 million.
The HST, while painted wrongly as a new tax, won’t change people’s lives very much. Even that ridiculous 50-inch television you may desperately be wanting won’t be affected, since you would have had to pay PST on it anyway.
Besides, there may be a silver lining in the whole exercise. In this society we’ve become prisoners of our consumer lust. Now that people are actually looking at the tax they’re paying for consumer trinkets, they may think twice about emptying their wallets for some brief moment of pleasure.
If the HST turns people into thriftier and – dare I say it – more intelligent buyers, I’m all for it.
Tony Wanless, CMC, is CEO of Knowpreneur Consultants, which helps businesses reinvent and innovate. Follow him on Twitter.
Comments
In speaking with two owners
Comment by Anonymous, August 11, 2010 at 13:32In speaking with two owners of small businesses of the value-added reseller variety, I became aware that the introduction of HST, which both individuals expected to be beneficial, actually added to their costs due to the removal of a commission for collection and remittance of PST. So my question is this: If the hst is indeed revenue-neutral, who exactly is receiving the savings that are supposed to be "trickled-down" back to the consumer?
This author obviously
Comment by Anonymous, August 6, 2010 at 10:42This author obviously believes his own BS. So far I have noticed increases on many things including food staples such as bread. For example I used to buy bread from a Bakery outlet store, they used to sell their bread that was close to its due date for $0.99 per loaf, that same loaf is now $1.25. HST is not directly charged but the bakery has increased the cost to cover their costs, funny how this happened after July 1st. I beleive this will trickle down through many other foods as well.
What really annoys me is the sneaky, underhanded way Gordo & Co deceived the voters of BC on this issue's, hopefully enough people will remember that next election time!
Tony Wanless As expected,
Comment by Tony Wanless, July 26, 2010 at 19:22Tony Wanless
As expected, most people didn't agree with me. But the surprise was the vehemence of the fitness community that gym memberships shouldn't be taxed.
But let's get something clear, here. Exercise and health are not being taxed. Service businesses that provide a venue for exercise, i.e. for money, are.
If you don't want to be taxed on exercise, take a walk or go for a run, or do some exercises at home. If you insist on paying someone so that you can have better equipment or training (a service) then you should be taxed. Other services are.
Isn't going to gyms because they have better equipment and better views the same as eating in restaurants because they cook better than you do?
Tony
Re "I work as a Athletic
Comment by Anonymous, July 8, 2010 at 16:05Re "I work as a Athletic Trainer"
If you are registered for the GST and now HST - which according to your comments you seem you are - then you have no extra costs in your rent. You used to pay 5% GST and now pay 12% HST on it - all of it you take out of your GST/HST submissions to the government before you submit it. So it doesn't cost you a penny more after your next return. And since your customers are paying you more, your monthly budget shouldn't be affected that much.
It is really bad if business people don't take the time to get information about how taxes work in their own business.
It's sad to see that writer
Comment by Anonymous, July 8, 2010 at 10:36It's sad to see that writer of this article sees the general population as children that need big brother Government to manage our spending habits for us. People are stretched in this stressed economy, and to have to pay more taxes on non-luxury items and services, when a lot of people are seeing either a) wage/salary freezes or b) layoffs, is adding salt to the wound.
HST and Luxury Cars. In
Comment by jasonhowardso, July 8, 2010 at 09:35HST and Luxury Cars.
In some cases, the HST really is a silver lining for consumers. Take for example luxury cars which used to be subject to the luxury car tax, but now under new HST rules, consumers can save a chunk of change. Eg. on a $60,000 car, buyers save $1,800 compared to the old luxury tax rule. Savings go up further with a $115k car saving of $3,500 with HST.
Jason Howard So
Director, Group Marketing
Auto West Group
I work as a Athletic Trainer
Comment by Anonymous, July 7, 2010 at 23:02I work as a Athletic Trainer - my clients should NOT be taxed for the training sessions offered to "encourage health and fitness". I can't imagine a government so stupid to TAX their people with an additional 7% of what we were not currently paying to improve their health and decrease health costs.. And how does my paying commerical rent to my landlord constitute a "bad spending habit"? With my $5000.00 monthly rent for my measly 850 sq feet should I have an additional 12% tax added on to my current and very fragile monthly budget? That is unjust! When does this all STOP? I am not a follower of any of the ridiculous "sweep it under the rug" and get used to it comments by your editorial on HST.
Get used to seeing my middle finger at this pathetic greedy government.
I bet the majority if the
Comment by Anonymous, July 7, 2010 at 14:23I bet the majority if the 18% that "took time out of their busy lives to express themselves and voice an opinion by signing" the petition didn't take the requisite time out of their busy lives to educate themselves on the issues that their signatures indicate that they disagree with. Signing a petition for or against something you don't understand is jsut voicing somone else's opinion.
Regardless of which side of the HST opinion you hold, please make it an educated opinion.
The HST will only encourage
Comment by Anonymous, July 6, 2010 at 15:03The HST will only encourage me to order more items online through the US. I'll just take my bad habits elsewhere.
HST is a tax burden shifted
Comment by Yves, July 6, 2010 at 14:21HST is a tax burden shifted from business to consumers, that much is crystal clear.
The article seeks to justify the shift by proposing to instill thrift on the population by forcing them to pay more for many products. Raising prices absurdly has been done before.
Well, the 117% markup on wine our province enforces is probably in the same spirit, forcing consumption into cheap wine of dubious quality "cellared in B.C." but made with plonk from Chile & other countries.
The HST will force people into cash transactions, black market labour agreements, and other behaviours that most would prefer to avoid.
For my part I do own a business & know the HST is "good for business" in a carnivorous way, I have been quite clear to my friends that I consider this shift of taxation from business to consumers morally bankrupt. and I dare say I am not the only business owner to declare that the HST is wrong.
Right or wrong, some 18+% of registered voters have decided to express themselves in writing (the petition) & this is a large enough chunk of the voting public that trivializing it (as this article does, amazingly) is a serious mistake.
People took time out of their busy lives to express themselves & voice an opinion by signing that petition. Shifting this tax burden by first promising "no HST" pre-election, then ramming it through like a getaway car post-election is so high handed that the high percentage of voters is not a surprise. Voters are not stupid, no matter what our current B.C. government caucus thinks. They can instantly recognize arrogance & they know the HST was pushed through with utter contempt for the constituents that elect the government.
Perhaps those people made thrifty by higher taxation will cut discretionary purchases ... mmm ... say certain magazines & newspapers?
While I have not been on the
Comment by Anonymous, July 6, 2010 at 11:04While I have not been on the anti HST bandwagon, I believe that your blanket referral to purchases as "bad habits" fails to take into account that all exercise and sport activities now have an additional 7 percent added. I don't believe that exercise is a bad habit but a good one that reduces reliance on health and social services.
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