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Wednesday May 22, 2013

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City hall OK with tax shift

The reintroduction of the provincial sales tax won't be causing too hefty a strain on local governments.

With the planned April 1 switch back to the PST-GST model, it signals a move back to something familiar for the city and the regional district.

"The nice thing is we already had all of those systems in place before," said city financial planning manager Kris Dalio. "At the time we went from PST-GST to HST we had done a big city-wide analysis as to how much that would affect us financially, and it wasn't even close to a material amount of money. Going back, we're not expecting to change."

The shift between the two tax models meant that any discrepancy in favour or against meant it was pretty much a wash, said Regional District of Fraser-Fort George chief administrative officer Jim Martin.

"There's certainly services that we purchase that are subject to HST and with that going down, those costs will be a little bit less," Martin explained, adding local governments receive a sizable credit on the HST or GST portions. "And then on goods that we purchase, of course, that will revert back to GST and PST, we'll probably see a shift where there might be a little more cost there to us."

The regional district did make some moves to take advantage of the HST before it was gone, however. Their finance department found some things that would be cheaper with the HST and advised the district move quickly to make the best of it.

"We had a couple of our volunteer fire departments where we had bought new fire trucks for them," Martin said. "We moved from lease agreements towards a loan and just bought one outright and in doing that, we estimate we're saving about $14,000."

And as corporations that deal with big budgets, losing the penny won't cause either local government too much grief, either.

"Most of the stuff we do, we don't really deal in pennies," Martin said of the regional district. Where cash transactions are more likely, such as in arenas in the Robson Valley or those paying landfill tipping fees, there may be some changes made to round up or down to the nearest five cents.

According to Dalio, those who pay drop-in fees at city facilities or make those kinds of smaller cash payments at the counter will see rounded figures beginning Feb. 12. But the financial planning manager noted he didn't expect the loss or gain of a significant amount.

"Accounting wise, if all of that added up to $100, plus or minus, for an entire year, I'd be really surprised," he said.


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