'New' PST will let business pay online
VICTORIA – The B.C. government has tabled its long-awaited legislation to kill the harmonized sales tax and return to the old provincial sales tax, with some modernization to make it easier for small businesses to administer and pay the tax.
Finance Minister Kevin Falcon said Monday the PST will return as scheduled in April 2013, with exemptions for haircuts, restaurant meals, bicycles, movie tickets, gym memberships and all the other rules it had before.
Falcon said the only sales tax breaks that won't return are temporary exemptions that would have expired by now, including energy-conserving windows and appliances, and fuel-efficient cars.
Tax changes that were made along with the HST will be maintained. That includes a 12 per cent provincial sales tax on privately sold used cars, making the tax equal to that paid at a car dealership. Provincial tobacco taxes were increased seven per cent when the HST came in, and that tax will continue. Liquor taxes will also be adjusted to keep retail prices the same as they are now.
NDP finance critic Bruce Ralston said the legislation tabled Monday is a relatively simple, with regulations listing the many rules and exemptions still to come this fall so businesses can prepare for next spring.
"I think they could have done it faster and they should have done it faster," Ralston said.
The government expects to save about $9 million a year in administration costs by using a new online registration and payment system for business, which B.C. expects to administer with about 100 fewer staff. Businesses will have to set up their computers to comply, with software expected to cost them about $1,000.
Low-income families will give up a $230-per-person rebate that was introduced to offset the higher costs of HST to consumers, including children. As of April 2013, the PST rebate will resume paying $75 per single adult with an income of $15,000 or less, or $75 per parent for families with an income of $18,000 or less.
Falcon noted an independent panel found the end of the HST will mean $520 million less revenue the the B.C. treasury next year, $645 million less the following year and increasing lost revenue after that.
"Clearly, any government in the future is going to have less revenue available to it, there's no doubt about that," Falcon said. "And obviously, we're going to have to manage the challenge of bringing back a tax that is less efficient and conducive to economic development."