At a time when B.C.’s coastal forest industry is struggling to sustain itself through unprecedented economic hardship, the introduction of the Liberal Government’s harmonized sales tax comes as good news.
For years Coast Forest has been pushing for the introduction of a value-added tax like the HST. Why? Because “approximately 40% of the PST revenue collected by Victoria is paid by businesses on a wide variety of inputs used in producing goods and services,” according to the Business Council of BC. “Under the proposed HST, the provincial sales tax now paid on inputs is effectively eliminated, as the 7% provincial portion will be credited along with the 5% GST for all goods and services purchased for business operations.”
Other jurisdictions do not pay this tax, so, like many producers and manufacturers in the province, to remain competitive worldwide the forest industry has been unable to pass the current PST on to its customers, and it has cost the industry $140 million per year.
Remember, the forest industry along with the other major manufacturers and exporters in this province are the industries that generate the high paying jobs and wealth which support our quality of life. By government creating a level playing field, businesses are more able to invest and increase productivity, which means they’re more able to sustain those high paying jobs, so people continue to have the ability to buy homes and eat out at restaurants. In fact, consumers can expect to see the price of most goods and services fall as the PST disappears, a trend evidenced in other jurisdictions under the HST.
The premier understands the introduction of the HST will not be as easy for some industries as others, and is offering to help with the transition as businesses adapt to the new regime. But timing is everything. With Ontario’s introduction of the HST, that province automatically becomes more business friendly. B.C. can ill afford to lose investment dollars that could subsequently flow east. This is a time when government and business need to work together to strengthen B.C.’s economy.
– R. M. (Rick) Jeffery, President & CEO, Coast Forest Products Association
Posted by coastforest 
