NEWS RELEASE · 21st July 2010
Less than three weeks after the introduction of the HST in BC, consumers and businesses alike are reporting that the impact of the new tax is much worse than many thought it would be, says former BC Premier Bill Vander Zalm.
“We are finding that the government has not been truthful with us about the HST yet again. The new tax actually amounts to more than 12% in some cases, because we have a tax on taxes,” said Vander Zalm, leader of the Fight HST petition to repeal the tax.
Vander Zalm says that anyone who has purchased an item with an eco fee or a deposit fee will notice the HST is applied on top of those other taxes. “The same problem occurs with the Parking Sales Tax - 12% HST is added on the 21% parking tax for a total of 35.2% in tax. It is outrageous!”
Vander Zalm says many parking vendors, as well as other businesses, have used the HST as an opportunity to increase the cost of goods at the same time. “Many have noticed that parking charges were also raised along with the new tax. In some cases parking fees went from $ 6.50 per hour to $ 10.00 per hour.”
“But it's not just parking garages. Some grocery items not subject to the HST went up as well. Our friend took their youngest son to the barber last week. Before the HST he charged $10, but after HST the haircut became $15 including the HST.”
Vander Zalm says that same barber would only cut hair for cash, and would not issue receipts. In some cases, people have reported being charged GST, PST and HST on the same bill. “My drycleaner tells me he is being hit twice – first with an eco fee and now the HST on his dry cleaning service. He says customers will now go without in order to save money they must pay elsewhere.”
Vander Zalm says the government has done an abysmal job of informing business on how and what to charge the HST on. He says it has given a lot of people a great excuse to up prices, and to overcharge on the tax.
“Some groups raised prices in anticipation of the HST. Vancouver’s daily newspapers were $1 each, but recently raised them to $1.25 including the HST – a 25% increase. Not a bad bit of extra profit at 13%,” Vander Zalm pointed out.
Vander Zalm says he has received numerous emails from British Columbians complaining about the tax:
A Kamloops man was told he would not have to pay any HST on the purchase of a new home he was having built because it was under the $520K threshold. But then his builder told him he had to pay an additional $23,000 up front until he received his “rebate” from the government on his taxes a year from now. “I don’t have that kind of money lying around. I will have to borrow it from a bank at interest. So much for HST not affecting a new home under $520K!”
A Vancouver man says his wife bought a package of “Huggies” diapers and was charged .80 cents HST. “Wasn’t that the same product the Finance Minister was holding up on TV saying there would be no HST? Either Safeway doesn’t know what they are doing, or Hansen, or both. What a fiasco!”
A furious accountant recently found out when he went to sell his boat that instead of the buyer having to pay only 5% GST, they now had to pay 12% under a “new” provincial tax called the TDP which was implemented to compete with the HST. “The buyer refused to pay the additional 7%, so guess who had to eat that?!”
A North Vancouver woman who runs a child care centre got a huge shock when she went to pay the rent on her business. The commercial lease increased by $691 per month due to HST. “This will put me in dire straits if I don’t pass the cost on to my clients. People are already struggling, and now to hit them with this, just after the government voted themselves a raise! Enough is enough!”
A Fishing Charter company in Mission says business is down significantly over last year as consumers have less disposable income as a result of the HST. He says costs are also up, making the HST a double whammy for him. “Instead of coming out of a recession, the government is making it worse with the HST. This is going to kill my business. I hope they all rot in hell with the other dictators in history.”
A businesswoman put an offer on a C11 zoned house to use as a building for her business. Then she found out that another $40,800 in HST would be applied to the sale because the tenants are paying more than $20 per day each for the two suites. As the building has no revenues, she has no way of getting the tax back. “I cancelled the deal. The HST cost me my location, cost both realtors their commissions and cost the vendor his sale. What a great way to stifle economic growth!”
A manufacturer of automatic gates says the HST has been responsible for several sales cancellations and is doing irreparable harm to his company. “They have started another tax cheating society such like we see in third world countries where bribes and cheating on taxes is the norm.”
A customer at a Mac’s convenience store in Salmon Arm was charged $2.33 for a magazine listed at $1.99 before taxes. On the receipt it listed the taxes at 12% “PST” plus 5% “GST” for a total of 17% in sales taxes. “Even some large chains haven’t figured out what they are supposed to charge in taxes. It is a total mess and a total rip off!”
Vander Zalm points out that even a soothing, stress preventing cup of coffee at Starbucks that used to be $1.69 is now $ 2.00 including the HST. “The price just went up and so far nothing has come down, not even the price of a ton of coal or a barrel of oil,” said Vander Zalm. “So far we have only seen price increases but no price decreases. The Minister of Finance admitted that the Aluminum Company in northern B.C., this year alone, would benefit to the tune of $70 million. But don’t hold your breath waiting for the price of aluminum to come down.”
Vander Zalm says citizens have called to tell him that when they complained too many time to the government about the HST, they were blocked as “spam” by the Finance Ministers email.
“He doesn’t want to hear the complaints. He won’t hear them. This government has shut its ears and its mind to the people. Now, they are spending millions on radio ads, and a mail out to all BC households! They are drunk with power. It is total madness, and British Columbians are being asked to pay the price for it all.”
Vander Zalm says early reports on the petition signature validation have been positive, and he is hopeful both the petition and the court challenge will have positive results, forcing the government to reverse course on the HST, saving BC from its long term negative consequences.
“We are going to keep fighting until the tax is gone. We’ll do it with the petition, or the court challenge, or if necessary, Recalls. But we won’t stop until they cancel this hated sales tax,” promised Vander Zalm.
Comment by Tristan Higginson on 23rd July 2010
That accountant mentioned in the story is either pretty dumb or misinformed and he got taken for a ride. It's an extra 5% not 7% on used vehicles, boats, etc. because they used to only have PST, not GST but now have the TDP of 12%. So if the accountant had to eat the extra 7% on the sale, the customer got an even better deal.
All well and good, but. . .
Comment by Barry English on 22nd July 2010
" The Minister of Finance admitted that the Aluminum Company in northern B.C., this year alone, would benefit to the tune of $70 million. But don’t hold your breath waiting for the price of aluminum to come down.”
All well and good, but when was the last time you, or anyone you know bought an aluminum ingot? Having said that, why are we all so happy that RTA seems to be proceeding with the Kitimat modernization project, a move that will again cut RTA's workforce by about 20 to 25 percent when done? Maybe everyone in Kitimat is afraid that RTA will take their HST windfall and leave town without our support.
Since big business, and the Liberals are so adamant that the HST is a good thing for us, you would expect that by now they would have at least trotted out some government sponsored feasability studies on new industry and jobs but . . . no such luck.