XPost: bc.politics, van.general, vic.general   
   From: NøCøns@our.House   
      
   Victoria— From Thursday's Globe and Mail -  May. 25, 2011   
      
   B.C. premier plans tax hike to pay for HST cut   
      
   Abandoning a decade of B.C. Liberal tax policy, Premier Christy Clark plans to   
   hike business   
   taxes to pay for consumer relief – a fundamental reversal of the shift that   
   was created by the   
   harmonized sales tax.   
      
   In a bid to help the tax survive a binding, mail-in referendum this summer,   
   Ms. Clark’s new HST   
   deal would include sending out cheques to half a million families and about   
   350,000 seniors   
   later this year, while holding out the promise of a lower HST rate if the tax   
   remains in place.   
   ^^^^^^^   
      
   But if voters want to see her promised 10-per-cent HST rate, they’ll not only   
   have to support   
   the tax in sufficient numbers, but they’ll also have to re-elect the   
   provincial Liberals to a   
   fourth term in office.   
   ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^   
      
   The HST is being put to a referendum because of a massive public backlash over   
   the new tax   
   regime that also threatened to swamp the fortunes of the governing B.C.   
   Liberals.   
      
   “We’re going to pay for this by rebalancing the burden of taxation between big   
   business and   
   consumers,” Ms. Clark told reporters Wednesday. “Lots of families will   
   actually be better off.”   
      
   Since taking office in 2001, the Liberals have steadily cut corporate taxes in   
   the name of   
   competition and job creation. But Ms. Clark is backing away from that: By Jan.   
   1, 2012, the   
   province’s corporate tax rate would rise from 10 per cent to 12 per cent,   
   while Ontario’s rate   
   is scheduled to drop to 11 per cent next year.   
      
   Ms. Clark is proposing to cut the HST rate to 11 per cent from 12 per cent on   
   July 1, 2012. The   
   rate would drop to 10 per cent two years after that. In the meantime, the next   
   provincial   
   election must be called no later than May, 2013, and Ms. Clark has said she   
   wants to head to   
   the polls as early as this fall.   
      
   It is only at the 10-per-cent rate that the average B.C. family would be ahead   
   – by $120 a   
   year – compared with the former system of a separate provincial sales tax and   
   federal GST. By   
   2014, however, the average family would have shelled out $815 more for goods   
   and services than   
   they would have under the old tax system.   ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^   
   ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^   
      
   The opposition New Democratic Party, which is urging voters to reject the HST,   
   has made no   
   commitment to cutting the rate. NDP Leader Adrian Dix said the proposed   
   changes still favour   
   big business over families, and he said voters shouldn’t believe that the   
   Liberals will lower   
   the rate as promised: “They can’t be trusted,” he said.   
      
   To bridge the HST gap until the first rate cut, the government is offering a   
   $175 cheque for   
   every child under the age of 18, to be paid out later this year. As well,   
   seniors with an   
   income under $40,000 would get the one-time payout of $175.   
      
   Ms. Clark’s plan would cost corporations $353-million each year by 2013, while   
   small business   
   would forgo a promised tax cut worth $280-million.   
      
   Just last month, B.C.’s Finance Minister, Kevin Falcon, scoffed at Mr. Dix’s   
   proposal to hike   
   corporate taxes – but also revert to the former PST/GST system. Mr. Dix’s   
   approach “is to crank   
   up taxes, attack business and destroy investment,” said Mr. Falcon in April.   
      
   On Wednesday, Mr. Falcon said business tax hikes had to be part of the   
   equation of selling the   
   public on the HST. “Although we have never been a government to promote any   
   tax increase, it is   
   clear that business is a major beneficiary of the HST and an honest   
   rebalancing is viewed by   
   the public as appropriate and reasonable.”   
      
   Jock Finlayson, executive vice-president of the Business Council of B.C., said   
   the business   
   community largely accepts the tax shift as a requirement to save the HST,   
   which has generated   
   $2-billion in savings each year for business.   
      
   “I’m not jumping up and down with enthusiasm over higher corporate taxes,” he   
   said. “But the   
   net effect is we are still significantly better off.”   
      
   Even with the business tax hikes, the government will have to dip into its   
   contingency fund to   
   make up lost revenue without derailing its plans to balance the budget in   
   2013. As well, the   
   province will have to maintain its ambitious targets of spending restraint,   
   likely extending a   
   wage freeze in the public sector, already in place for two years, until the   
   year 2015.   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)