Shift back from HST must also include improvements to tax in B.C.
British Columbia’s government should focus on a smooth and clearly communicated transition back to the PST/GST, said the Canadian Federation of Independent Business (CFIB).
"There is no question, small business owners must see an improved provincial sales tax going forward," said Shachi Kurl, director of provincial affairs, B.C. for the CFIB.
"It is expected to cost $30 million to reinstate the infrastructure to collect a tax that has been described as 'broken'; one that 59 per cent of our small business members viewed as the bane of the regulatory existence," said Kurl.
The province introduced the HST, which blended the seven per cent provincial sales tax with the five per cent federal GST, on July 1, 2010. But the blended tax will be scrapped after 54 per cent of voters said to get rid of it in a recent referendum.
The CFIB wants to see the return of the BC Taxpayer Fairness and Service Code for PST which recognized business owners' rights to fair treatment, timely appeals and dispute resolution in their dealings with PST officers. The code recognizes business owners' right to complete, accurate, clear and timely information when navigating complex PST rules, said the organization.
The code should further protect business owners by having provincial tax officers provide written answers to written questions that are binding if the business owner acts on the advice given, said the CFIB.
Clear communication around the timing of a transition back to the PST is essential, according to the organization.
"Business owners will be dealing with everything from re-keying cash registers to uncertainty around customers waiting to make purchases on items that may or may no longer be tax exempt," said Kurl. "It is critical that our members are told what to expect, when to expect it, and have access to quick and accurate answers to their questions through the transition period. Small business owners deserve information they can rely on."
Earlier this year there was a delay in the reduction of the small business tax rate to zero per cent, which was on track to happen by 2012. It was delayed as part of a larger plan to drop the HST to ten per cent if the voters had chosen to maintain the tax, the organization said.
"B.C. must return to conditions that encourage small business survival and growth. Eliminating the small business tax rate as soon as is fiscally responsible is an important step on that journey," said Kurl.
