There is much debate over the pending Harmonized Sales Tax vote, mostly political rhetoric, that plays on a number of things - did the government lie in not talking about the HST, is the 12 per cent under the old system better than the 10 per cent HST going forward, etc. Most of the talk is pure politics with no shortage of experts prepared to step forward and make their case one way or the other to suit their political needs.
But this is a very important vote that will play a significant role in shaping our economy for the future especially in small rural communities like Terrace. It is a decision that requires very careful consideration of the impacts of our decision; not just each of us as individuals but as a community.
The one area that both proponents and opponents agree upon in this debate is that the HST is good for business. In most cases this is characterized as more “ill gained profits for big business”, but like most things it is much more complicated than that.
The HST is good for the resource sector. Huckleberry Mine specifically mentions the HST as something that takes their marginal economics and makes the mine viable preserving more than 200 permanent jobs. There is no shortage of sawmills and potential bio-mass or energy investments that, having the ability to receive an additional 7 per cent back from government, see the economics of their projects improve.
It is especially good for owner operators, of which we have many in the region. If you were a log truck driver in Terrace today and paid $100,000 for a truck, instead of receiving $5,000 back under the old system you now receive $12,000. On top of that they receive an additional 7 per cent back on their operating costs as well. When prices or rates are low this could make the difference between working and staying at home.
In rural towns most of our industries are resource based and tied to the markets that move up and down. When prices are up and markets flush, things work just fine, but when the prices go down, business curtail operations, workers are laid-off and usually leave the community in search in new employment; sometimes never to return. This has been the scenario of rural B.C. and the resource sectors we depend on.
The HST doesn’t change the cycle but it does makes those businesses a little less vulnerable to the market swings and lets them operate in a more marginal market than they did before. Having the ability to factor in another 7 per cent makes a significant difference in the viability of a business. The HST is less about “ill gained profitability” and more about operability. More stability translates into more consistent, reliable and predictable employment - something that is attractive for each of us.
For all of us who call rural B.C. home, the desire to be able to have our children grow up, go to school and get a job close to home has always been important. For too long we have watched as our children leave the area in search of a work, never to return. There are many components that allow for our kids to be able to stay in the communities they grew up in and HST is one of those things governments can do that supports that goal.
So the hype and politicking will carry on for a while around the HST. It will be characterized as shifting taxes from corporations to individuals from the rich to the poor.
But it really comes down to this: if we want to give our kids a chance to work at home, supporting the HST and voting “NO” to its extinguishment is a small but practical way to reach that goal.
It supports the resource sector by preserving existing employment, attracting new investment and helps mitigates some of the swings of the boom and bust cycles we have become so used to seeing: over the years it will build communities not tear them apart.
Roger Harris is a former MLA for the Skeena riding.