When there’s a single thief, as the saying goes, it’s robbery. When there’s a thousand thieves, it’s taxation.
But when hundreds of thousands of people are allowed to vote, harmonized taxation goes by the wayside.
Elections B.C. announced Friday that 54.73 per cent of the province’s voters cast a ballot in favour of extinguishing the harmonized sales tax, marking the first time recall legislation forced the B.C. government to reverse course on policy.
“I think it was a resounding victory as far as I’m concerned,” said Paul McCavour, who, alongside his wife Julie Turner, organized the Penticton and Boundary-Similkameen anti-HST campaign.
“I’ve had so many people who came up and said to me, ‘You can’t do anything about it. Governments lie.’ I say the only reason governments lie is because you don’t do anything about it, not that you can’t do anything about it.”
The two local ridings posted the same referendum result, but with different margins. Of Penticton residents who voted, 11,489 — or 50.49 per cent — voted in favour of extinguishing the HST. Voters in Boundary-Similkameen were more decided in their opposition to the tax: 9,679 or 59.48 per cent cast a ballot to dump the tax.
McCavour said those figures were likely a conservative estimate of those opposed to the combined federal and provincial sales tax.
“I don’t really trust the numbers that Elections B.C. passed out. That’s what they counted, but I wonder how many didn’t they count? A lot of people never got their form, they were late or things like that,” McCavour said.
Anger was likely voters’ main motivation, he added.
“A lot of people, their main reason for signing the petition was because they didn’t like to be lied to,” he said. “On the other hand, if they were taking all of this tax and putting it into health care, social welfare and education, instead of giving it to shareholders of big business, then I would have thought twice about this.”
Bill Barisoff, Liberal MLA for Penticton, said local farmers had been pushing for changes to the system since he held the revenue ministry portfolio in 2001, and expressed concern about how the changeover will impact farmers and the agricultural industry.
“It will definitely have an impact on jobs across the province,” he said. “That’s the price we pay for democracy. The people have voted, so now we have to work back and figure out how to make this work.”
Moving forward, the province will have to reinstate the 12 per cent PST and GST tax system, which is expected to take a minimum of 18 months. In the interim, eligible British Columbians will continue getting their HST credit cheques in the mail. Once the HST is discarded, the PST credit will be put back into place.
“Certainly the people have spoken that they want to go back to the old system,” Barisoff said. “But as I have told people, the sun will rise in the east and set in the west like it did this morning. We’ll have to work through it and make the best of it.”
Barisoff predicted they have a big financial riddle to solve ahead, though. The provincial government must pay back the $1.6 billion incentive from the federal government, in addition to making up the $1.4 billion in lost revenue as a result of extinguishing the tax.
“That’s almost a $3 billion hole that they’ve now got to plug into government making sure that we balance the budget by 2013 or 2014,” he said, adding the premier and finance minister are working “to soften the blow.”
McCavour doesn’t buy that argument, however.
“There shouldn’t be a difference. It was supposed to be revenue neutral. That’s what we were told,” he said, adding that Saskatchewan got rid of its HST and fared well after. “Our province is not going to fold up and blow away. We survived hundreds of years without the HST.”
Jason Cox, the president of the Penticton and Wine Country Chamber of Commerce, said he wasn’t surprised by the outcome given the “steep hill” that proponents of the HST had to climb in convincing the voters that the tax was good policy.
“We believe it’s going to have a profound effect on the economy and business,” he said, stressing “mom and pop operators” will be affected a great deal.
“At a time when the economy is fragile enough, we’re profoundly disappointed with the outcome.”
Cox said Penticton and area businesses would like to see the next 18 months used to have a discussion on how to create fair tax policy that’s good for both consumers and business owners.
“I think we’ve heard from the finance minister that it’s going to take some time to unscramble this egg,” he said. “In that time, hopefully the best and brightest minds around the province can come up with a plan that works for British Columbians.”