Our View: Tax policy rejection portends election

Let’s face it, the HST referendum and debate wasn’t really over an unpopular tax.
People didn’t vote to get rid of it because they loved the PST-GST combination, much less preferred the way it was administered.

Let’s face it, the HST referendum and debate wasn’t really over an unpopular tax.

People didn’t vote to get rid of it because they loved the PST-GST combination, much less preferred the way it was administered.

It was, like so many elections fought over the years, a vote of confidence in or lack thereof in the government and its policies.

What the resulting vote to extinguish the HST  indicates is that the Liberals’ time in power in British Columbia, unless some very drastic steps are taken to woo voters, is fast coming to a close.

The HST referendum acted as a kind of dry run to the provincial election. It had very similar elements to a political campaign: dislike for the current government, fanned by the way the combined tax was introduced; an ambitious politician anxious to champion the cause of the so-called “working people” – Bill Vander Zalm; and a simple method of changing things: vote against it.

The HST had pockets of support: Oak Bay-Gordon Head residents voted to keep it. But those in NDP-held constituencies overwhelmingly chose to get rid of it.

Regardless whether peoples’ reasoning for voting for or against the HST was sound – the complexities of tax policy are lost on most people – it was based on trust.

While many have celebrated the result, we all need to brace for the aftermath. The province, having committed to restoring previous PST exemptions and looking at $360 million less in tax revenue annually, will immediately seek ways to make up the difference – the Liberals have no appetite for operating deficits.

By the time the province returns to the GST-PST combo in 2013, the B.C. government will have spent hundreds of millions backtracking and recreating tax infrastructure. Then there’s the point of repaying $1.6 billion to the feds.

The ironic part of this “people’s referendum” is that we may well have put the Liberals in a similar financial mess to the one they inherited from the NDP back in 2001.