I've read with interest, the propoganda put out by the B.C. Government, and various other analysts in advance of the June Referendum on the H.S.T. in British Columbia.  A common thread throughout the information being provided to those who will vote to kill the tax (or not) is the threat of "where will the money come from".  At the same time, it is suggested that the HST only adds about $300 per year to each family.  Seriously?  From my own experience, that is completely untrue.  This year, my Strata Corporation embarked on a large scale maintenance project, and the net effect of the HST is an additional $105,000 tax burden on the owners.  Anyone who has undertaken renovations, repairs or maintenance on their home since July 1, 2010 has had to pay an additional 7% on the labour portion of that work.  Anyone who has bought or sold a home since the July 2010 has paid an additional 7% on real estate fees, home inspections, and other moving costs.  As a Strata Council member, I review the monthly invoices that are paid out of owners' maintenance fees - add 7% to many categories where there is labour involved, resulting in increased strata fees.  Insurance premiums, although not directly taxed HST, have increased as a result of it.  Immediately after the HST was introduced, our Strata Corporation received a letter from our insurer, advising that since most repairs covered under insurance are subject to HST, our premiums will go up.  The Government  of B.C. is not giving us the full story of the impact of this tax, and what it means to ordinary working British Columbians in their attempt to soften the impression of the HST with their stick man ads and various other media.

As for the Government threatening to cut services if the tax is killed, let's consider this.  The Government of British Columbia collects Property Transfer Tax on each and every property sold (except for qualifying first time buyers), every time it is sold.  So what does this mean to the Government coffers?  I've done a little calculating, based on properties sold in the WEST SIDE of Vancouver ONLY.  Since July 1, 2010, a total of 1,813 detached homes were sold on the West Side, at an average price of $2,194,800, which represents $79.6 million in Property Transfer Tax collected by the Government, or an average of $40,000 per household.  If we add to that 4,408 Attached properties sold in the same period, at an average price of $656,659, the PTT collected is $57.8 million, or a total of $137.4 million in the West Side ONLY.  If we were to calculate the amount of PTT collected across the province, the amount would be shocking to most.  In the Vancouver market, where sales of luxury homes to foreign buyers are the highest in recent history and with ever increasing real estate prices, the amount of PTT collected over the past 12 months should be filling up the government coffers nicely.  And let's not forget about the Carbon Tax (which will go up again in July) that you pay every time you fill your gas tank.

In a province where household incomes are not keeping pace with the cost to buy a home, and ever rising numbers of homlessness, can we really continue to tax a basic necessity like shelter with these outrageous taxes, and add HST to the cost of buying a home?

Let's consider the REAL impact of the HST on property prices.  The developer builds a new house which would have sold for around $2 million without HST.  The additional 7% tax (less the maximum rebate) works out to $113,500 which must be paid by someone, either the buyer or the seller.  The builder now is having difficulty selling due to the huge additional tax burden, and includes the tax in his revised price of $2.1 million.  Now take the seller down the street who has a 1 year old house, in "as new" condition.  He sees a sale price of $2.1 million and asks the same price for his home.  The HST, just like the GST, skews the market because of embedded taxes, and as a result increases prices across the board.  This happened when the GST was introduced, and it has an even greater impact with HST.  The increase in prices does filter downward, as it creates the impression that prices have risen more than they have in reality.  We also need to consider that the home builder's largest expense is labour, for which there is no input tax credit, therefore, he cannot reduce his end price by any significant amount, if he is to make a profit.