British Columbia

B.C. Liberals say they would eliminate PST for a year if elected

Andrew Wilkinson said the PST, currently at seven per cent, would be brought back after one year, but at a reduced rate of three per cent "until the economy recovers from the COVID-19 pandemic."

Andrew Wilkinson argues it's needed to stimulate the economy, says tax would go up to 3% after a year

Andrew Wilkinson previously pushed for a temporary suspension of the PST and the employers' health tax as a way to stimulate the economy during COVID-19. (Mike McArthur/CBC)

The B.C. Liberals say they will eliminate the provincial sales tax for one year if they are voted into power in the Oct. 24 provincial election.

"We need to get people back to work ... this will give people spring in their step," said Leader Andrew Wilkinson in the first big policy announcement of any party so far in this election campaign.

Wilkinson said the PST, currently at seven per cent, would be brought back after one year, but at a reduced rate of three per cent "until the economy recovers from the COVID-19 pandemic."

"It gives people a chance to get ahead," said Wilkinson.

"It gives people a chance to go out and do the things they want to. That's what we want to do right here in B.C."

In May, Wilkinson pushed for a temporary suspension of the PST and the employers' health tax as a way to stimulate the economy during COVID-19. 

The province projects a deficit of almost $13 billion and a GDP drop of 6.7 per cent this year due to the effects of the global pandemic. 

B.C. Liberal Leader Andrew Wilkinson promises to scrap the PST for a year, then bump it to three per cent in the second year, in an effort to help the province recover from the pandemic. But John Horgan and Sonia Furstenau question how the Liberals will cover the estimated $7-billion loss in revenue. 1:13

Wilkinson said the tax cut would help all British Columbians.

"The lower your income, the more you have to spend on provincial sales tax. So, this is designed to get everybody in the economy ... enjoying life again, because it will benefit people with lower incomes the most."

How will it be paid for?

Wilkinson made his announcement in Richmond, B.C., at the same time NDP Leader John Horgan was holding a press conference in Victoria.

"If he's going to take money out of the budget, I hope he's going to tell British Columbians what services he won't be providing," said Horgan. 

The sales tax brought in an estimated $7.6 billion in revenue last fiscal year, according to the province.

Wilkinson said spending on health or education would not be reduced to make up the budget shortfall, but admitted the party hadn't done a full costing or analysis of the effects of a PST elimination.

"Everyone knows that we're in a big economic crisis, and this is not a time to worry about the details so much as to get back to work," he said. 

Wilkinson also indicated that a balanced budget would be less of a priority.

"We should be under no illusions: There will be deficit spending for some years to come in every jurisdiction in the western world," he said.

"But that doesn't mean that we just back off and let people suffer." 

The NDP has not said if it has any plans to adjust the PST, but Horgan said the party's platform would be released early next week.

Meanwhile, B.C. Green Party Leader Sonia Furstenau said the Liberal plan lacked the imagination needed to lead B.C.'s pandemic recovery.

"After three and a half years in opposition, the best idea the B.C. Liberals can come up with is a sweeping, antiquated tax cut," Furstenau said. 

"During their 16 years in government the B.C. Liberals made countless cuts to vital social services that people rely on every day. We have seen how service cuts simply create more costly social and economic problems."

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