VANCOUVER, May 5 /CNW/ - The report by an independent panel that
reviewed the advantages and disadvantages of the province's harmonized
sales tax offers a fair and accurate analysis of the new value-added
tax, Bruce Hurst, FCGA, the Chair of the Certified General Accountants
Association of British Columbia said.
"The panel's comprehensive and balanced review of the HST shows that the
tax will help boost our economy," said Hurst. The report noted that by
2020 it will add 24,400 better paying jobs, make our economy $2.5
billion larger than it would be under the PST, and produce $1.2 billion
more in the export of goods and services. The Association has been a
strong supporter of the HST as it will boost the province's
competitiveness and makes good fiscal policy.
The report makes it clear that the issue of taxation is complex and
rarely black and white. "The panel acknowledges that taxes are, in and
of themselves, unpopular. But it is important for government to strike
the right balance and to ensure a positive investment climate for job
creation and economic growth while being able to adequately fund
health-care, education and other programs," Hurst said.
"The introduction of the HST improves transparency and removes what had
been a 'stealth' sales tax," Hurst noted. "In the days of the PST,
businesses paid the seven per cent tax and simply passed it along to
consumers, who then often paid PST again on top of that. The panel
calls it the 'invisible PST.' With the HST, most businesses receive a
credit on sales tax, which means they no longer pass it along to the
consumer. This is a very important benefit."
According to Hurst, the panel did a wide-ranging assessment of the costs
that the HST has added to a typical family. And it is clear that the
lowest earners receive rebate cheques to offset the cost of the HST
while the highest earners pay the larger share of the tax.
While the report speaks to the price tag for government of returning to
the dual PST and GST regime, it is silent on the compliance costs to
businesses of switching back. If a return to the old PST happens,
businesses and their accountants would have to invest in new accounting
and software systems and pay for training to deal with a return to the
more complicated GST and PST. "A return to the old system will add
greater complexity resulting in expenses that will be passed along to
consumers," says Hurst.
It also has wider implications for our overall economic success. "Apart
from having to repay $1.6 billion to the federal government, it means
that British Columbians will lose some very real economic benefits that
will hurt our competitiveness. We will also reduce our credibility in
the eyes of the investment community by reversing direction and
re-adopting an outdated tax," said Hurst.
The Association also believes that if and when the HST proceeds that the
government should provide a report that provides a summary of HST
revenues compared to the old PST. This would demonstrate the economic
benefits of the tax and provide transparency, Hurst said.
The panel was made up of four prominent individuals: a former Alberta
Treasurer; a former Auditor General of B.C.; the CEO of Coast Capital
Savings; and a Professor of Public Policy at Simon Fraser University.
"We believe that the panel has made an important contribution to the
public debate on the HST and CGA-BC encourages all citizens to take the
time to read their report and vote for the tax in the upcoming
referendum," Hurst said.
As the province's largest professional accounting association, CGA-BC
represents nearly 15,000 CGAs and students. Members work in industry,
commerce, government and in public practice. The Association promotes
the excellence of its members and advances the accounting profession
through education, certification and the protection of the public
SOURCE Certified General Accountants Association of British Columbia
For further information:
Edward Downing, Director of Communications
Telephone: (604) 730-6208 or (778) 838-6334