The president of the B.C. Chamber of Commerce insists only a minority of businesses in Metro Vancouver object to a proposed new 0.5 per cent sales tax for transit and transportation.
John Winter says fears of business flowing out of the region because of the proposed Congestion Improvement Tax have been voiced mainly in Langley, where shoppers may be tempted to go east to Abbotsford to avoid the new tax.
“They’re the ones who feel they will bear the brunt,” he said, but insisted there is broad support for the Yes side in the spring referendum among business leaders elsewhere in Metro Vancouver.
“The business community is solidly behind this,” Winter said, adding concerns about extra bureaucracy and costs to separately report a new sales tax are overstated.
“I don’t think it’s going to be a huge problem,” Winter said.
New car dealers in particular fear lost business but Winter said 0.5 per cent works out to just $200 on a $40,000 car.
“I’ve never met a car dealer who wasn’t prepared to wheel and deal,” he said, predicting dealerships in places like Langley and Maple Ridge won’t sit back and let customers take their business east to the Fraser Valley over a relatively small amount.
But Blair Qualey, president and CEO of the New Car Dealers Association of B.C. said he wants clarity from the province on whether or not dealers will have to absorb the tax hike before his organization takes a stand on the plebiscite.
“This tax could be a pretty big chunk per year for these guys if they have to swallow it to stay competitive,” Qualey said.
He said that could force auto dealers to cut costs in areas such as charitable giving within the community.
Even if the province charges the new 0.5 per cent tax on vehicles bought outside the region but ultimately registered within Metro Vancouver, Qualey said that may still leave questions of how it will be enforced.
If the new tax applies to car dealers, Qualey wants it also added to the sales tax charged on private car transactions.
Richard Truscott, B.C. director for the Canadian Federation of Independent Business, predicts a significant degree of opposition from his small business members.
“I would expect there to be a fair amount to cynicism and doubt as to whether an extra half point on the PST is the right way to fund transportation improvements,” he said.
Truscott said the CFIB wants greater accountability for the billions of dollars already being spent on transit and infrastructure in the region.
“To turn around and ask taxpayers to fork over even more dough leaves a lot of business owners scratching their heads.”
He said the CFIB is surveying its members on the new tax and expects to take a position in January, provided there’s enough of a majority for or against.
Greg Wilson, government affairs director for B.C. for the Retail Council of Canada, said there is concern among retailers about the extra costs and reporting requirements that will come with a new separate tax.
That means yet more reprogramming of point-of-sale terminals and computer systems after the creation and then repeal of the HST.
“It also tends, along with everything else, to drive more traffic to the U.S.,” Wilson said. “Our members along the border are acutely aware of that.”
But Wilson said he is also hearing strong support for the new tax from many retailers because of the transit and transportation improvements it would bring.
“I hear as many positives as negatives,” he said. “I have a lot of members who tell me how good it will be, how it will help customers get to their stores, bring goods to their stores and bring employees to workplaces.”
The Retail Council of Canada is unlikely to take a position for or against, Wilson said.
Yes campaign unites ‘strange bedfellows’
John Winter is a key member of the Yes campaign and it’s not his first time promoting a contentious tax.
The president of the B.C. Chamber of Commerce fought to keep the harmonized sales tax but saw it go down to referendum defeat in 2011 with 55 per cent of voters opposed, forcing the province to reinstate the provincial sales tax.
This time both Winter and anti-HST strategist Bill Tieleman are on the Yes side urging Metro residents to agree to the new tax for transit road and bridge upgrades.
“It does create strange bedfellows,” Winter acknowledged, but added it underscores the broad coalition of business, labour, environmental and other groups backing the cause.
He calls it a “non-partisan” common-sense issue and said he’s “very optimistic” the plebiscite will pass.
Ballots go out March 16 and must be mailed back to Elections BC by May 29.
The 0.5 per cent sales tax charged only in Metro Vancouver is to generate an extra $250 million a year, which combined with federal and provincial government contributions would fund $7.5 billion in transit, road and bridge upgrades.
“There’s no purpose in voting No,” he said. “If people do we’re going to be stuck with the gridlock we have, only worse.”
Heading the No campaign so far is Jordan Bateman of the Canadian Taxpayers Federation.
Bateman is seeking to tie the new tax to the unpopularity of TransLink, which is not mentioned on the mail-in ballot going to referendum.
Winter insists the vote should not be a referendum on TransLink and says Bateman is circulating “unfortunate misinformation” by focusing on TransLink waste.
“From a voter’s perspective, this is a non-issue, a smokescreen,” Winter said, arguing money from the new tax will be restricted to funding the new projects in the mayors’ vision, with independent audits to ensure that happens.
“They’re going to spend this money with handcuffs on them.”
Bateman calls that “malarky” and says Winter, the mayors and other Yes campaigners are deluding themselves and voters by avoiding mention of TransLink.
“The other side knows TransLink is a completely failed brand, ” he said, adding audits are no insurance.
“The audits will happen after the money is spent. So congratulations, TransLink wasted more of your money and you found out after an audit.”
Bateman said there are plenty of questions hanging over the referendum and whether the promised transit upgrades can actually be delivered.
He promises to release an alternative plan in January to expand transit without adding the new sales tax by finding savings within TransLink and municipal government spending.