One item sorely missing from the B.C. finance minister's recent budget was a plan to make the province's business taxes more competitive and attractive for investment. When the province shifted back to the PST last year, the cost of doing business and investing increased dramatically. Disappointingly, de Jong's budget did nothing to address this shackle around BC's economy. Tax reform, however, might be the light at the end of tunnel.
According to our monthly Business Barometer survey, B.C. small business confidence grew substantially this year. In February, B.C. ranked in sixth place among Canada's 10 provinces -- but by the end of November, we were sitting solidly in second place. With the New Year almost upon us, it is worthwhile to take a moment to reflect upon 2013's high and low points for small business.
In 2013, Canadians worked until June 10, which happens to be Tax Freedom Day, to pay all their taxes. Tax Freedom Day is an easy-to-understand measure of the total tax burden imposed on Canadian families by federal, provincial, and local governments. But the true tax burden doesn't end with the revenues that governments collect.
The BC Liberals and particularly Premier Christy Clark deserve the praise they're receiving for their surprise electoral victory. After all, the Liberals reversed a double-digit deficit in the polls and ended up securing a majority government. This moment of jubilation for the Liberals and their supporters will be short-lived however, as the reality of governing in difficult times takes hold. The litmus test for the success of this government, which they themselves established, is the success of the economy and in particular, jobs.
It was no joke; on April 1st B.C. officially scrapped the HST and in one fell swoop, restored the old Provincial Sales Tax system. But moving back to the PST will cause harm to the provincial economy and B.C. families will lose out on the increased prosperity and jobs that the HST would have encouraged. Since our province will be poorer with the PST, it falls on our political leaders to take action to lessen the impact.
Once the champagne is drunk, the noisemakers go silent, the balloons pop and the New Year's kisses end, 2013 will bring one nasty hangover for cash-strapped B.C. taxpayers. Taxes, fees and levies from all levels of government are set to go up, leaving even less of your hard-earned money in your pocket.