Wednesday, March 31, 2010

Keeping crème de la crème fraîche

Northern Insight's most-read article is brought back to the top at the request of readers. It was first published July 27/09.

Moving to HST by broadly applying a 12% combined federal and provincial sales tax, is good for British Columbia consumers, particularly poor folks who are too often denied opportunities to contribute their full shares to government coffers. And, this consumption tax will ease the burdens on businesses because PST on their costs is eliminated and any HST they pay will be rebated.

We can be confident that business will be better off because the Premier and the Minister of Finance, high officials noted for truthiness, said that businesses would save $1.9 billion dollars a year from a revenue neutral tax change. We can applaud this because the financial interests of business should be protected by government; that is a fundamental principle of progressive liberalism, or at least it should be, if it is not.

Every time poor consumers pay the harmonized tax, they will be reminded that government services are expensive. Studies have shown that people forced to pay painful taxes and user fees, particularly those who pay disproportionally high amounts of income, are less likely to demand new services from government. For example, when eye examinations were no longer covered under MSP, many older folks and children stopped selfishly seeking expensive eye glasses just to satisfy some whim of vanity or to improve vision. Ordinary folks were clogging the system, harming the speedy access desired by people able to use their own money for service.

The tax change fits with the BC Liberal Government's program of improving lives of the more worthy people in our province – la crème de la crème. We've reduced their high income taxes, moving toward flat tax rates and funding government with user fees, tolls, licenses and MSP premiums that apply equally to rich and poor. The policy is fair. How can rich people stay rich if they are required to help others? Civil rights of wealthy citizens are sacrificed when government imposes a progressive tax system.

The next step is to reduce health care services that are flooded mainly with common folk – le lait écrémé. Shutting down public operating rooms and hospital beds and rationing hospital based imaging and specialist services will boost the private health care sector. They can focus efforts on those private patients best able to afford their fees. Everyone knows that readily available public health care, where not even basic user fees are charged, reduces the financial productivity of the private clinics that look after our important citizens. People with busy schedules shouldn't have to wait months for medical care like ordinary people.

Provincial governments of the past occasionally harassed private medical care providers, even threatening to enforce the Canada Health Act, the law that bans user fees, extra billing and other barriers to universal physician and hospital care across Canada. We can thank the BC Liberals for beginning the move away from naive egalitarianism toward tax fairness and better treatment of la crème de la crème .
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Jean-Baptiste Colbert, Minister of Finance for Louis XIV of France:

"The art of taxation consists in so plucking the goose as to obtain the
largest amount of feathers with the least possible amount of hissing."
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2 comments:

  1. Great tongue in cheek but a very serious problem. The question is, how many people is this government willing to kill, banish to the streets, starve, and brutilize in order to sustain themselves along with their wealthy friends and business partners? My bet is, they don't care.

    ReplyDelete
  2. Let’s look ahead to July 1, 2010


    In British Columbia where the cost of housing is literally the highest in Canada, you are out with your wife and children looking for a house to buy.

    You have 2 choices. Both houses are the same size and are on the same size lot.

    A. The first house is brand spanking new and has a sale price of $550,000.

    If you buy it, in addition, you will pay $9,000 in Provincial Property Transfer Taxes.

    As well, with the HST now in effect, you now will also have to pay an additional $66,000 less, as I understand it, a rebate of $20,000.

    Therefore your total cost for this new house will be $605,000.

    B. The second house is a used 5 year old house and has a sale price of $550,000.

    If you buy it, in addition, you will pay $9,000 in Provincial Property Transfer Taxes.

    Therefore, your total cost for this used house will be $559,000.


    What affect do you think the HST will have on a house buyer’s decision making given these 2 choices?

    ReplyDelete

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