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

Homeless strategy, living wage topics of final Kelowna candidate forum

The all candidates forum was held Wednesday night at the Rutland Centennial Hall

Kelowna Chamber of Commerce hears cases for and against proportional representation

Official proponent and opponent speak about the pros and cons of changing how we vote provincially

Cannabis not welcome on Central Okanagan school grounds

School district superintendent/CEO addresses cannabis issues in letter to parents

Berry: Millenials need to vote, here’s why

Millenials continue to have the lowest voter turnout in the country

Okanagan RCMP look for owners of various keys located during arrest

RCMP seek to reunite the owners of various keys found at the arrest of suspects in a stolen vehicle.

Mellow opening to B.C.’s only legal pot shop

About five people lined up early for the opening of the BC Cannabis Store in Kamloops.

Police hand out a few hefty fines for allegedly violating Cannabis Act

Police in Canada posted a photo of a $215 ticket given to someone who allegedly had a baggy of marijuana in their car

Great British Columbia ShakeOut earthquake drill reminder

Don’t miss the opportunity to participate in the Great ShakeOut

South Okanagan hunter injured in ATV incident evacuated by rescue teams

Hunter was found on a mountainside overlooking Cawston

Jagmeet Singh says marijuana pardons are not enough

Trudeau government will streamline pardon process for Canadians convicted of simple possession of marijuana in the past

BC Ferries begins taking debit in two-month pilot project

Company is giving customers option to use Interac on two-month trial on select vessels

Caregivers banned from smoking, growing cannabis around children-in-care: MCFD

Ministry has limited cannabis use for caregivers, stating it may “pose a risk to children and youth.”

Most Read