It’s no secret that the tourism industry in B.C. has struggled with how to respond to the harmonized sales tax. However, in light of the proposed two-per-cent reduction, it is clear to the Tourism Industry Association of B.C. that the HST will be good for B.C.’s tourism economy in the long run.
This was not black or white for us. As soon as the new HST was announced our association, which represents all of the major tourism industries in B.C., immediately began work, not to oppose the new tax, but to identify and implement ways to mitigate the effects of the tax on our sector.
Part of our challenge was that the impacts of the new harmonized tax were different for different parts of tourism both by business type and by location: hotel prices went down, the cost of restaurant meals went up, and businesses closer to Alberta which does not have a provincial sales tax were particularly sensitive to HST.
Like other concerned sectors of the B.C. economy, we noted decreased consumer confidence around the time HST was implemented in B.C. and Ontario in July 2010. This occurred in the early recovery period after a recession. We have been relieved to see that domestic consumer confidence has begun to trend in a positive direction.
We are very pleased that the provincial government has promised to reduce the HST by two per cent and is actively championing improvements to a federal visitor rebate program that will encourage foreign buyers to choose Canada and B.C.
We now share the growing concern of the broader business community over the uncertainty and considerable financial difficulties that a move back to the old PST-GST system would create for B.C.
The provincial government has listened to British Columbians and we are confident they are earnest in their commitments to reduce consumer costs and help impacted sectors like tourism grow into the future.
Now is not the time to take a backwards course. A 10 per cent HST is the way forward for tourism in B.C.
Stephen Regan, President
Tourism Industry Association of B.C.