BC Liberal tax cut proposal a $7.5 billion revenue hit

Canadian Taxpayers Federation endorses PST elimination for one year, but acknowledges challenges to balance to the budget

An election campaign promise by the BC Liberals to eliminate the Provincial Sales Tax (PST) for a year has earned the endorsement of the Canadian Taxpayers Federation (CTF).

And the CTF hopes both the NDP and Green Party will opt to meet that challenge announced last week by Liberal leader Andrew Wilkinson.

“We pay the PST on everything from used cars to toilet paper so this would save everyone a lot of money,” said Kris Sims, B.C. director of the Canadian Taxpayers Federation.

“The best way to save people money is for governments to stop taking so much of it in the first place.”

The PST is a seven per cent sales tax applied to nearly every item sold in B.C. with the exception of food. The zero tax pledge also extends to liquor, which carries a higher 10 per cent PST.

In the 2019-20 budget year, the PST generated more than $7.5 billion in revenue for the provincial government.

“Why we are excited about this tax cut is it affects everyone the same, both the lower income person and the wealthy…it keeps money in people’s pockets to spend,” Sims said.

“And it could be a tremendous benefit to restaurant owners, who rely on alcohol sales on average for up to 30 per cent of their revenue. A 10 per cent tax cut could make or break them in a given year.”

Sims acknowledged the tax cut will raise issues of how to make up the loss of $7.5 billion in the provincial budget.

“How to make up that difference is what the Liberals would have to figure out. They will have to go through the budget line item by line item to assess their wants and needs,” she said, noting that 60 per cent of the provincial budget is taken up by health and education related costs.

“That would be a challenge but it would help juice the economy. We are not in favour of the PST. It should be zero. Governments should rely on income tax to generate revenue and that increases when you increase job creation.”

To make her argument, Sims cites how a recent study revealed a lack of energy pipeline capacity expansion has cost the federal government $13 billion of income tax revenue, and how B.C. is losing out on PST when British Columbians travel to Alberta, where there is no PST, to buy larger cost items.

“It is better to keep more of our own money rather than funneling through provincial or federal government relief programs that can be tailored or niched, and miss out people who need the help.”

In response, the BC NDP dismissed the proposal, noting groceries, rent, car insurance, prescription medication, school supplies, children’s clothing and child care are already exempt from the PST

BC Green leader Sonia Furstenau said the PST proposal shows a lack of imagination by the BC Liberals.

“This old-school style of economics is not what B.C. needs to recover. We need to target our recovery efforts to the economic sectors that need it most,” Furstenau said in a statement.

BC politicsBC Votes 2020taxes

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

A fundraiser for the Falkland Community Church is underway. (Photo submitted)
COVID-19 leaves Falkland Church in a lurch

Annual event/major fundraiser cancelled for first time in 34 years

Advance polling saw nearly 10,000 votes cast in Vernon-Monashee. Pictured: Schubert Centre. (Jennifer Smith - Vernon Morning Star)
Almost 10,000 turn out to Vernon-Monashee advance polls

19 per cent of 52,479 registered voters have made their mark in B.C. election

Members of the Armstrong Lions Club have planted a red Canadian maple tree at Lions Park on Hunter Avenue as a show of tribute to their sister club in Banbridge, Northern Ireland. (Roger Knox - Morning Star)
Armstong Lions Club salutes sister club with tree

Red Canadian Maple planted in Lions Park pays tribute to Lions Club in Banbridge, Northern Ireland

The Community Foundation has teamed with the Canadian Mental Health Association and horse-assisted therapists to bring horse therapy to frontline worker battling the COVID-19 pandemic free of charge. (Contributed)
Okanagan organization says ‘thanks’ to COVID-19 frontline workers with complimentary horse therapy

Community Foundation teams with CMHA and equine therapists to offer unique mental health supports

COVID-19. (Courtesy of CDC).
Interior Health reports 12 additional COVID-19 cases

The total number of cases in the region is now at 644

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

B.C. Provincial Health Officer Dr. Bonnie Henry. (B.C. Government photo)
Kelowna Francophone school COVID-19 outbreak climbs to 5, mixture of students and staff

Health officer says situation evolving, spoke to possible closure, changes to provincial guidelines

Actor Ryan Reynolds surprised a Shuswap family with a special birthday message to their son who was worried he’d be alone on his 9th birthday on Nov. 24. (Tiffanie Trudell/Facebook)
Ryan Reynolds text almost gives away Shuswap boy’s birthday surprise

Deadpool actor helps remind eight-year-old Canoe resident he’s not alone

Colin James put on a great show at the Comox Valley Exhibition Grounds as part of the 2019 Vancouver Island MusicFest. But his Okanagan tour for 2020 has been postponed until 2021. (Photo by Terry Farrell)
COVID-19 cancels Corb Lund’s Vernon, Penticton, Trail, Cranbrook concerts

The Contenders, Colin James and Lund postponed until 2021

RCMP detachments across B.C. are now flying Pride flags. (Submitted photo)
Man who spent 4 days injured on floor rescued by Kamloops Mountie

The man is recovering in hospital after being rescued by a police officer conducting a well-being check

Vancouver police reactivated the search for Jordan Naterer Thursday Oct. 22. Photo courtesy of VPD.
Mom of missing Manning Park hiker believes her son is waiting to come home

‘He’s going to come out of a helicopter and say ‘what took you so long?”

Environment Minister George Heyman, Premier John Horgan and Energy Minister Michelle Mungall announce that B.C. Hydro is proceeding with construction of the Site C dam, Dec. 11, 2017. (Tom Fletcher/Black Press)
Site C actions, costs won’t be known until after B.C. election, Horgan says

Peace River diverted for construction of reinforced dam base

Five people with alleged ties to the Red Scorpion Gang are facing numerous charges. (Kelowna RCMP)
5 men linked to Red Scorpion gang charged with gun, drug offences in Kelowna

Police seized a machine gun as well as 5.5 kilograms of fentanyl and carfentanil

Most Read