Tax drives up costs

I recently had a conversation with a couple of friends that insisted that HST was being collected on sales of used vehicles from individuals. I disagreed, and we made a small wager; however, I thought this may be of interest to others.

I recently had a conversation with a couple of friends that insisted that HST was being collected on sales of used vehicles from individuals. I disagreed, and we made a small wager; however, I thought this may be of interest to others.

Prior to 1 July 2010, on purchase of a used vehicle from a private owner (non GST registrant) GST (five per cent) was not charged. The sale of this vehicle was, however, subject to PST of seven per cent to 10 per cent, depending on the vehicle. This was collected at time of ownership transfer.

After July 1, 2010 on a private sale of a vehicle there is no HST (or GST) charged; however, 12 per cent PST is collected at the time of change of registration. This has nothing to do with HST or GST — it is solely a provincial tax. So I win the bet (Jim & Roy).

This begs the question of an unfair provincial windfall. As my friends pointed out, this used vehicle could be sold and resold numerous times, and on each sale the province would collect 12 per cent PST. The provincial tax collected on these sales could eventually exceed the original price of the vehicle. This is certainly an unfair provincial tax grab.

I just wanted to point out the unfairness of this provincial application of this type of tax, as well as the short-sightedness of politicians who are obviously not thinking, or are thinking that they can deceive the public.

Blame your politicians who interpret the applications of provincial tax laws in this way … and deal with them at election time.

But do not blame this anomaly on the HST. This is nothing more than politicians hiding the truth. And to plead ignorance is to acknowledge said shortcoming.

Patrick MacDonald

 

Penticton