I have just been investigating the effects of HST and would like to share with you (and possibly your readers) some things that I have found out which I think are very important and that, I believe, few people are aware of.
The first thing is that rebates equal to the HST are given to industry for purchases that they make for their business, where previously they were given rebates only for the GST.
This gives the result that where business used to pay towards the operation of the province, they no longer do. The cost of running the province has been shifted onto the consumer.
Another thing that I have learned is that when a young couple buy a new home today in B.C. they must pay considerably more for the house than they would have under the previous GST only tax, since new housing was exempt for the PST.
For a house with a sale price of $200,000.00 the additional cost is $7276.80 when one includes the taxes on the retailers’ commissions (assuming 1.5 per cent commission rate). If the house costs $700,000, as might be the case for our poor friends down in Vancouver, then the additional taxes amount to more than $25,000.
We have no guarantee that if the HST is eliminated that the government won’t then add the PST to the cost of a new house. We would have to ask them — during the next election campaign — what their intentions are and then decide whether or not we can trust what they say.
I am not an expert on tax matters so my numbers may not be entirely correct, but I think they are right and would welcome any corrections that might be offered. Unless I am convinced otherwise, I intend to vote YES — eliminate the HST — and I would encourage others to do the same.