The Fraser Institute

The Fraser Institute

August 26, 2011 11:40 ET

Fraser Institute Economists Hopeful BC Will Keep the HST; Available for Comment Following Referendum Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 26, 2011) - BC's economic future will appear dimmer if the results of the HST referendum show that BC voters have rejected the harmonized sales tax, says Niels Veldhuis, Fraser Institute senior economist.

"A return to the PST will damage BC's competitiveness compared to provinces such as Alberta or Ontario, and we will have lost an opportunity to realize the increased investment and job growth that the HST would have encouraged," Veldhuis said.

"And with the government promising to reduce the HST to 10 per cent, the return to a 12 per cent PST/GST will also result in an increase in the total tax bill of the average BC family."

Over the past year, Veldhuis and Fraser Institute senior policy analyst Charles Lammam authored two studies on the effects of the HST, both on the economy and on BC families.

Lammam calculated the impact returning to the PST/GST would have on the tax bill of typical BC families and found that all families will end up paying more, with low income families being especially hard hit.

"Returning to the PST system not only changes the amount of sales tax we pay, but for many families it will also mean higher personal income taxes since the BC HST credit will likely be rescinded," Lammam said.

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 80 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit

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