Soft drinks are exempted from provincial sales tax along with other grocery store items. (Wikimedia Commons)

Extend sales tax to soft drinks, B.C. advisory group says

Province not extending PST, or scrapping homeowners grant

A B.C. government tax fairness advisory panel has recommended extending provincial sales tax to all non-alcoholic beverages except for milk and plain water.

The task force, set up to look at alternatives to Medical Services Plan premiums, also recommends eliminating the homeowner grant and replacing it with a refundable tax credit.

The report, completed in March, was released Thursday by the finance ministry without comment on the recommendations. It says soft drinks should never have been exempted from PST along with the rest of foods, because they have little nutritional value.

The report also recommends introducing a “value added tax” similar to the harmonized sales tax that was rejected in a province-wide referendum.

The finance ministry issued a statement Thursday saying that the drinks tax, changes to the homeowner grant or changing the PST to make it similar to the harmonized sales tax are not being considered.

The task force noted in its interim report that a payroll tax to replace MSP premiums would affect business competitiveness. Finance Minister Carole James has moved to implement the payroll tax next January, while cutting MSP premiums by half at the same time.

The report calls the homeowner grant for property taxes a “regressive feature of the tax system that is fundamentally unfair and would be improved by using the income system to provide more progressive tax relief to homeowners and renters.”

It recommends an enhanced sales tax credit and carbon tax credit for lower income people, funded by the revenue from extending PST to most non-alcoholic beverages.

The report was produced by University of Victoria professor Lindsay Tedds, UBC professor David Duff and former NDP finance minister Paul Ramsey. The task force was set up last fall to find ways to replace government revenues lost due to eliminating MSP premiums. That was pre-empted by James’ February budget, which imposed a payroll tax.

The “employers health tax” takes effect in 2019 at 1.95 per cent of payroll for businesses and organizations with payrolls of more than $1.5 million. A lower rate applies for payrolls between $500,000 and $1.5 million, and those below $500,000 are exempt.

The payroll tax applies whether employers pay their employees’ MSP premiums or not. James emphasized that while property taxes may go up, individuals stand to save $800 a year or more if they have been paying their own MSP premiums.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Moms of those killed by illicit opioids take to B.C. Legislature in call for action

Moms Stop the Harm, a nationwide network of families who have lost loved ones to overdoses rally

Gwaii Haanas Report: Talking About Everything plan

By Victoria Leslie A dinner of crab legs and clam fritters, halibut… Continue reading

115 new wildfires burning across B.C. due to 19,000 lightning strikes

More fires expected to start today, says BC Wildfire Service officials

CHN seeks injunction against logging at Collison Point

Weeks after ordering an end to a blockade there, the B.C. Supreme… Continue reading

Marijuana to be legal in Canada Oct. 17: Trudeau

Prime Minister made the announcement during question period in the House of Commons

VIDEO: Canadian toddler caught practising hockey skills in crib

Eli Graveline is getting praise from far and wide as the internet freaks out of cute throwback video

Man shot dead in Surrey ID’d as hockey coach and father of two

Murder of Paul Bennett – a respected Peace Arch Hospital worker and ‘champion of sport’ – ‘not random’

Serial killer Robert Pickton transferred to Quebec: victim’s family

Pickton was convicted in December 2007 of six counts of second degree murder

Canadian Syrian children’s choir not to attend festival over fears about U.S. travel

Many kids are recent immigrants from countries covered by Trump travel ban

B.C. teacher ends Jeopardy! winning streak, taking home US$69,000

Ali Hasan, from New Westminster, has been gaining fans as a “one-man invasion,” says Alex Trebek

Jett Woo highlights 5 Canucks choices on Day 2 of NHL entry draft

WHL star out of Moose Jaw tabbed in Round 2

In a matter of hours, women in Saudi Arabia will be allowed to drive

Change was announced as a royal decree in 2017 by Crown Prince Mohammen bin Salman

Feds announce measures to protect endangered whale species

Canada’s Whale Initiative is part of the federal government’s $1.5 billion Ocean Protection Plan

Most Read