The province’s competitive marketplace will ensure the transition to the HST is a smooth but not quite seamless process, according to the Business Council of B.C.
Jock Finlayson, the council’s executive vice-president said in a recent interview: “There are some sectors that will be challenged by [the HST], but the overwhelming majority of industries that make up the B.C. economy, particularly the industries that are the foundation of our export base, will be significant beneficiaries of the changes.”
What about B.C. consumers who are experiencing the new tax regime as an increased financial burden?
“It’ll translate into higher incomes for people,” said Finlayson. “The reason to do it – and virtually all economists would support this – is you’re going to incent (sic) more investment. You’re going to make it more attractive for companies to produce things here. You’re going to attract more capital investment and the jobs that come with it.”
But, he added, the benefits of the HST would take time to materialize.
He said studies suggest that in the next five to 10 years, B.C. would see a significant increase in investment, employment and productivity thanks to the HST.
“You have to remember that because the cost of business will decline by $2 billion when this is fully implemented, there will be a [flow-through] of a fair chunk of those cost savings to final consumers in B.C.
“I know people are skeptical that will happen, but the research is crystal clear that it does happen – at least in markets where you have competition. And we have a very competitive marketplace in B.C. for consumer goods and services.”