HST math

Last week we were treated to the provincial government unveiling its plan to offer a big enough financial incentive - aka bribe - to get British Columbians to back the HST in the upcoming referendum.

Last week we were treated to the provincial government unveiling its plan to offer a big enough financial incentive – aka bribe – to get British Columbians to back the HST in the upcoming referendum.

That included the HST being reduced by one per cent on July 1 next year (the earliest that can be done under the original HST deal with the federal government) and a further one per cent on July 1, 2014.

Families with children would get a right now one-time payment of $175 per child.

Now for a couple with two kids, that promise translates to $350 for the year.

Given an independent study says that’s exactly how much extra the average family is paying under this supposedly “revenue neutral” tax regime, that’s a break even for that family.

Except, as mentioned, the $175 is a one-time payment. So the break even is only for the first year.

Given the government’s two step on the HST reduction, it seems reasonable to conclude that the first one per cent cut halves the extra that family is having to pay because of the HST and the second reduction will wipe it out.

So our family breaks even on the first year but, in the absence of that cheque in the second year, it comes out on the wrong side by $175 in year two.

And year three.

In other words this family is expected to vote for the HST because they only get dinged $350 under the new family-friendly plan instead of $700.

Such a deal.

If you don’t happen to have a couple of kids running about the place, presumably the HST hit is less than $350 a year.

But at the same time you get no one-time relief  you get no relief so will be out of pocket for each of the next three years.

Sadly, in the end it matters not a jot how the HST vote goes because we know full well the government can always recover lost revenues by simply jamming up all manner of fees we are required to pay.

Malcolm Baxter

PS: Isn’t is strange that the Liberals’ proposal to finance part of the HST cuts through an increase in the corporate tax rate has been greeted by the corporate sector with deafening silence?

 

Seems to suggest the amount by which they benefit from HST is more than that tax bump.

 

Northern Sentinel

Just Posted

Fire ban back in effect for Northwest Fire Centre region

Starting May 24, both Category 2 and Category 3 prohibitions will be in place

Kelowna company wins contract for LNG Canada project in Kitimat

SK Form & Finish will work with equivalent of 4,000 fully loaded concrete trucks

U.S. tariffs on Canadian aluminium scrapped

Joint effort by industry, government and unions secures deal

Rio Tinto BC Works watching Nechako reservoir levels closely

Dropping water levels could threaten power generation operations

600 new campsites coming to provincial parks and recreation sites across B.C.

Tourism Minister announced half of the new spots to 13 most popular provincial parks

B.C. man who fell off cliff returns there to rescue eagle from vulture attack

Nanaimo’s James Farkas, who broke his hip in a fall, saves eagle on same beach months later

Raptors beat Bucks 105-99 to move within 1 game of NBA Finals

Leonard scores 35 as Toronto takes 3-2 series lead over Milwaukee

Municipalities protest after B.C. declares marijuana crops ‘farm use’

UBCM president seeks answers in letter to John Horgan government

CMHC defends mortgage stress test changes amid calls for loosening rules

Uninsured borrowers must now show they could service their mortgage if rates rose two per cent

Nisga’a Nation tourism industry hits the road

First pilot tour to the Nass Valley is set for this summer with Indigenous Tourism BC

B.C. woman left ‘black and blue’ after being pushed off 40-foot cliff at lake

West Shore RCMP looking for witnesses as investigation continues

Thunderstorms to bring heavy rain, risk of flash floods in the southern Interior

Ten to 30 millimetres of rain to fall over the early weekend

MAY 23: the first of 1,200 trailers start arriving

JFJV has a transportation plan in place to minimize impact

Most Read