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

Yes, we could use a soft drink tax

NDP rejects useful tax advice because it’s not popular

The B.C. NDP government has snubbed its own hand-picked tax advisors, refusing their suggestions on how to replace the billions in revenue from Medical Services Plan premiums.

The fate of the expert panel’s advice was set in February, before their report was even complete. Finance Minister Carole James pre-empted it by announcing that MSP was going to be phased out starting with a 50 per cent cut in January 2019 and elimination the next year. It will be replaced with a payroll tax called the “employers health tax” that will hammer large-scale farmers and other businesses with substantial payroll costs.

The payroll tax lands on schools, hospitals and municipalities too, so your property taxes are likely going up. With raises being negotiated by public sector unions, who continue to get their MSP premiums covered, you’ll be paying.

The tax panel soldiered on and produced a final report in March, which was finally released and quietly rejected by the finance ministry two months later. Don’t feel too badly for these experts, however.

The panel, chaired by UVic economics professor Lindsay Tedds and including former finance minister Paul Ramsey and UBC law professor David Duff, billed just under $100,000 for their work.

The real scandal here isn’t the wasted money. It’s the experts’ suggestions that were tossed aside, apparently because they are seen as too politically risky.

You may have heard about one of them, extending provincial sales tax to soft drinks. They wanted sales tax on every retail bottled drink except plain milk and water, including diet drinks.

The bulk of this is sugar-laden soft drinks, iced tea and coffee, fruit juice concoctions and so on. They are a main source of the overdose of sugar self-administered by far too many of us, with consequences of obesity and diabetes. This would be a “health tax” that actually improves health, instead of this ill-considered payroll tax that the NDP government rushed into instead.

Soft drinks were exempted from B.C.’s seven-per-cent sales tax along with most other grocery items. This mistake could be corrected now, but politicians’ fear of sales tax increases is just too strong.

So you can imagine the reaction to another panel recommendation, to convert the PST into a “value added tax.” This is what the harmonized sales tax tried to do. It makes sales tax more fair to businesses that try to compete and create employment. But HST, for which I was a lonely voice in favour when it was imposed in B.C., remains a four-letter word.

With the U.S. steeply reducing business taxes, it would be great to have an adult discussion about tax reform and competitiveness, but we can’t.

Another proposal was to scrap or modify the home owner’s grant, introduced by Premier W.A.C. Bennett in 1957. Bennett sold it as relief from rising property taxes, which will rise more because of the “health” payroll tax on hospitals and the rest. But the HOG is now a sacred cow.

“The home owners grant is a regressive and unfair element of the tax system that could be significantly improved by making it income-tested and extending it to renters, which is an outstanding commitment of government,” the panel said in its report.

The finance ministry gave out a terse “background” statement on the report’s suggestions.

“It will be no surprise that a return to the HST is not on the table, and we are not considering a tax on sugary drinks or changes to the home owners grant at this time.”

Tom Fletcher is B.C. legislature reporter and columnist for Black Press. Email: tfletcher@blackpress

Just Posted

Langley goes Hollywood

Red carpet fundraiser for ER campaign

Langley pedophile wins appeal after violating court order

Kelly Glen Isbister’s sentence was cut by the BC Court of Appeal

Neighbour recounts ‘fifteen minutes of insanity’ after deck collapses at Aldergrove wedding

Local resident Charles Ford ran over to the dozens wounded, along with many other neighbours

High school mechanics get ‘huge head start’

The ACSS apprentices will showcase their work at this year’s Country Car Show in Aldergrove.

$18 million Aldergrove amenity seen as unfair for other Township communities

An unanimous council voted in favour of Councillor Eric Woodward’s policy to provide downtown Aldergrove with more resources.

What’s age got to do with it? B.C. couple with 45-year gap talks happy marriage

An Armstrong couple that has 45-year age gap began turning heads after being featured on show Extreme Love.

WATCH: South Vancouver Island shooting an ‘isolated and targeted’ incident, say police

One person in custody, another fled following shooting and crash on West Shore

Woe, Canada: Bruins down Maple Leafs 5-1 in Game 7

No Canadian teams left in Stanley Cup playoffs

Defence accuses officer of ‘incompetence’ in trial for B.C. man accused in daughters’ murder

Double murder trial for the Victoria father accused of killing his two young daughters continues

Should B.C. parents receive money if they make sure their kids are vaccinated?

New survey looks at public opinion around government’s role in forcing immunizations

Loud jets from Abbotsford are annoying residents of tiny U.S. town

Flights out of Abbotsford airport turn over border town and annoy residents, Sumas mayor says

B.C. men challenge constitutionality of Canada’s secret no-fly list

Parvkar Singh Dulai says he received a “denial of boarding” notification under the no-fly program last May 17

Murder on B.C. property didn’t need to be disclosed before sale, court rules

Buyer had tried to break contract after learning a man with ties to crime had been murdered there

VIDEO: Spiderman-clad Lamborghini makes pit stop in Abbotsford ahead of Avengers premiere

Highstreet Shopping Centre displaying unique car during Friday’s opening of Marvel movie

Most Read