By now, I would think that most people have seen the advertisements from the "support the HST" crowd.
There are the earnest ones with accountants telling us that the HST is good for their business.
After all, it means that there are more businesses that now need their services.
More things are taxed than under the old system and the businesses involved all need help with forms.
And then there is the one that has a "small business" telling us that the HST has allowed them to create "jobs." Not singular. Plural. Consider that claim.
Let's say that these jobs are minimum wage, with no benefits, and that there are only two of them (the minimum to qualify as plural). At $8.00/hour and a 35 hour work week, that is $280 per week or $14,560 per job per year - a total $29,120 for the two.
In order for the HST savings to amount to that much money, the company would have been spending some $416,000 per year on PST eligible business inputs. Things like office machinery, paper products, or maybe a vehicle or two.
Still that is an awful lot of money for a small business to be spending on business inputs. Indeed, if normal business ratios apply, this would easily be a "multi-million dollar per year" company - not a "mom and pop" corner store.
But all of these commercials miss the point.
No one ever said that the switch to the HST is not good for business (Bill Vander Zalm aside). Having businesses not have to pay PST on business inputs is not a bad idea. It might even make economic sense.
The real issue is that the government chose - and make no mistake about it, they chose - to make up the difference in revenue to the provincial coffers by charging it to you and me. The HST is a direct transfer of funds from your pocket to B.C. business. This from a government that ran on a campaign of not subsidizing business.
Despite vague promises of lower prices allowing the money coming back to you aside, we - the taxpaying public - are now paying businesses to stay.
However, even more egregious than the Smart Tax Alliances' commercial is the campaign by the BC Liberals, paid for with your money. It includes all sorts of things to obscure the true cost to the taxpaying public. And they are anything but an informed and non-partisan display of information. Not even close.
One that I have seen multiple times has a little stick man sitting between two massive stacks of forms. One is labelled "GST" and the other "PST." By my count, there is something in the neighbourhood of 27 papers in each stack.
Our poor little stick man is struggling through one of these forms. Filling in numbers then erasing them as he obviously made a mistake. He is wearing a visor so that we know he is a bookkeeper or an accountant, and this is hard work.
The commercial then fades to a picture of a "GST Office" and a "HST Office" - both massive buildings. But they quickly blend together to give a much smaller "HST Office." First implication - the HST requires a smaller bureaucracy.
We then switch back to the little stick man who is suddenly much happier as he realizes that he has only seven forms in his one HST inbox. And he quickly fills in the form with no mistakes. Second implication - fewer forms which are easier to fill in.
The tag line says something about less bureaucracy for small businesses. Except that is not true.
The not so subliminal message is that the HST is simpler, less forms, and easier to deal with. Maybe. But it is also applied to 20 per cent more goods and services than the PST. That means that there are more business and individuals remitting HST and filling in forms than under the PST. For some businesses, the HST means more work not less. Where do you think some of the promised jobs will come from?
My favourite, though, is the latest set of "buy-the-vote" commercials which are promising to drop the HST from 12 per cent to 10 per cent over the next three years. With an announcer telling us that this will save the average British Columbian family $120 per year. Wow.
Except it is not a "saving." It simply means that instead of paying $350 per year in additional taxes through the HST, the average family will be paying on $230. But that is still $230 more than you would be paying under the old PST/GST system. How cynical is our government to believe that by charging us less than they had originally planned, they could call it a "saving" and people would believe it?
The HST is the wrong tax, at the wrong time, for the wrong reasons.
