With just a few weeks until the Harmonized Sales Tax referendum gets underway, proponents of the controversial levy are working to get their message out—this is a good tax for B.C.
“In the past few years we have made a lot of headway building a youth-driven film and animation industry in the Okanagan.
HST is an integral part to offset the high cost of the Canadian dollar,” said the Okanagan Film Commission’s head, Jon Summerland, on Wednesday.
“International production companies currently get the HST back when they finish production.”
If HST goes away they will only receive a credit on GST, which may not be enough.
“Tell all your friends: HST is good,” he pitched.
At a Kelowna Chamber of Commerce meeting the same day, the message from two accountants pretty much echoed that sentiment.
“We all agree, the introduction of the HST wasn’t the best,” said Heather Weber, a CGA with Meyers Norris Penny LLP.
“It generated confusion, people didn’t understand how it would work. But as an accountant and a British Columbian, I know the HST is the better tax.”
What the argument boiled down to was that implementation of the HST streamlined business operation costs and made B.C. more competitive.
On the streamlining front, Mike Boven, a CA with BDO Canada LLP, explained how the paperwork burdens will be far less onerous for businesses.
Instead of being held accountable to two branches of government, and having to remit paper work monthly to the provincial stream, the HST is a once-a-year, one-stop, deal for most.
The HST is also a lot more well conceived than the PST/GST combo that had gaping holes, he said.
Boven pointed out that the confusion of the double-tax system could cost some businesses a great deal in consultation fees.
Most importantly, perhaps, is that it will keep B.C. businesses more competitive with their Alberta counterparts, he said.
In the pre-HST world, it was difficult to get businesses that worked in B.C. to actually headquarter in the same place.
Turns out, putting a head office in Alberta acted as a shield for B.C.’s provincial taxes.
“Business was driven to Alberta,” Boven said. “Now the advantage is gone, so there’s no incentive to go elsewhere.”
While the advantages for businesses are numerous, said Weber, the question at hand now is what would happen if the clock were turned back, as the referendum proposes to do.
At the very least, businesses internal systems would have to be reworked. The province would have to rehire tax auditors and taxpayers would have to repay the $1.6 billion transfer funds the feds passed over to move to an HST system.
“It isn’t perfect, and there are some additional costs,” she said. “But it helps business and if it’s not doing well, we’re not doing well.”
To learn more about the tax, go to the website hstinbc.com.