The provincial government is bringing back the provincial sales tax.
It had no choice – it was told to do so by voters in the HST referendum.
The harmonized tax, and specifically the way it came about, was so reviled that a majority of voters were quite prepared to bring back the PST. This despite the fact the PST is not nearly as efficient and does not come with the tax credits the HST does.
Voters weren’t even swayed by a provincial promise to reduce the HST to 10 per cent, which would be two per cent lower than the combined GST and PST.
The province had no one to blame but itself, although that hasn’t stopped it from blaming leaders of the Fight HST campaign, the media, rebellious citizens and the NDP.
At least the new PST looks like it will be a little simpler for businesses.
While the government’s new PST bill does not specify what goods and services will be exempt from PST, Finance Minister Kevin Falcon said the exemptions will be similar to those under the old PST. The list of goods and services to be exempted will be published as a regulation, making it easier for the government to adjust the list of exempt items.
This naturally has raised suspicion, as the Liberals’ record on the HST has been a long series of broken promises.
But the entire HST exercise was beneficial in several respects.
It showed that citizens have the power to put limits on governments that exceed their mandates. There was no promise of an HST in the 2009 election. Two months later, it was government policy.
B.C. referendum law enabled citizens to overthrow this reversal in policy. The HST debacle caused one premier to leave office and may yet cause the defeat of the government.
Future governments should be more cautious in going against public will, and refusing to listen to reasonable concerns.