Feds amend law to allow B.C. to cut HST by 2 per cent
VICTORIA – The B.C. government’s promise to reduce the harmonized sales tax from 12 to 10 per cent by 2014 has taken a step forward, with a federal government amendment to the law governing the tax.
Under the changes, the B.C. portion of the HST would fall to six per cent on July 1, 2012, and to five per cent two years later, leaving the federal portion of the tax at five per cent.
That is, if B.C. residents vote in favour of keeping the HST in a mail-in referendum later this month.
Finance Minister Kevin Falcon says he’s confident people will decide a 10-per cent tax rate is better than the old 12 per cent combined PST and GST.
However, the NDP says people paid no provincial sales tax on many items under the old formula and the HST represents a massive tax shift from business to families.
In addition to pledging to cut the HST, the Liberal government has also promised to send one-time transition cheques to families with children under 18 years old and to low- and modest-income seniors.