The B.C. NDP government has snubbed its own hand-picked tax advisors, refusing their suggestions on how to replace the billions in revenue from Medical Services Plan premiums.
The fate of the expert panel91裸聊视频檚 advice was set in February, before their report was even complete. Finance Minister Carole James pre-empted it by announcing that MSP was going to be phased out starting with a 50 per cent cut in January 2019 and elimination the next year. It will be replaced with a payroll tax called the 91裸聊视频渆mployers health tax91裸聊视频� that will hammer large-scale farmers and other businesses with substantial payroll costs.
The payroll tax lands on schools, hospitals and municipalities too, so your property taxes are likely going up. With raises being negotiated by public sector unions, who continue to get their MSP premiums covered, you91裸聊视频檒l be paying.
The tax panel soldiered on and produced a final report in March, which was finally released and quietly rejected by the finance ministry two months later. Don91裸聊视频檛 feel too badly for these experts, however.
The panel, chaired by UVic economics professor Lindsay Tedds and including former finance minister Paul Ramsey and UBC law professor David Duff, billed just under $100,000 for their work.
The real scandal here isn91裸聊视频檛 the wasted money. It91裸聊视频檚 the experts91裸聊视频� suggestions that were tossed aside, apparently because they are seen as too politically risky.
You may have heard about one of them, extending provincial sales tax to soft drinks. They wanted sales tax on every retail bottled drink except plain milk and water, including diet drinks.
The bulk of this is sugar-laden soft drinks, iced tea and coffee, fruit juice concoctions and so on. They are a main source of the overdose of sugar self-administered by far too many of us, with consequences of obesity and diabetes. This would be a 91裸聊视频渉ealth tax91裸聊视频� that actually improves health, instead of this ill-considered payroll tax that the NDP government rushed into instead.
Soft drinks were exempted from B.C.91裸聊视频檚 seven-per-cent sales tax along with most other grocery items. This mistake could be corrected now, but politicians91裸聊视频� fear of sales tax increases is just too strong.
So you can imagine the reaction to another panel recommendation, to convert the PST into a 91裸聊视频渧alue added tax.91裸聊视频� This is what the harmonized sales tax tried to do. It makes sales tax more fair to businesses that try to compete and create employment. But HST, for which I was a lonely voice in favour when it was imposed in B.C., remains a four-letter word.
With the U.S. steeply reducing business taxes, it would be great to have an adult discussion about tax reform and competitiveness, but we can91裸聊视频檛.
Another proposal was to scrap or modify the home owner91裸聊视频檚 grant, introduced by Premier W.A.C. Bennett in 1957. Bennett sold it as relief from rising property taxes, which will rise more because of the 91裸聊视频渉ealth91裸聊视频� payroll tax on hospitals and the rest. But the HOG is now a sacred cow.
91裸聊视频淭he home owners grant is a regressive and unfair element of the tax system that could be significantly improved by making it income-tested and extending it to renters, which is an outstanding commitment of government,91裸聊视频� the panel said in its report.
The finance ministry gave out a terse 91裸聊视频渂ackground91裸聊视频� statement on the report91裸聊视频檚 suggestions.
91裸聊视频淚t will be no surprise that a return to the HST is not on the table, and we are not considering a tax on sugary drinks or changes to the home owners grant at this time.91裸聊视频�
Tom Fletcher is B.C. legislature reporter and columnist for Black Press. Email: tfletcher@blackpress
