Some of the ‘congestion improvement tax’ concerns have been dealt with

Province has made it clear that Metro residents buying cars and other big ticket items outside Metro Vancouver will still pay the tax

Last week’s column focused on the fairness of the proposed .5 per cent tax to fund TransLink improvements, and the obstacles which Metro Vancouver mayors will have in getting a majority of those who vote to support it.

The provincial government has now approved the idea, but with a few minor changes. It wants the tax to be known as the “Metro Vancouver Congestion Improvement Tax,” and to be added on to the seven per cent PST — but not necessarily to every single item subject to the PST.

The province wants the question worded to include the following phrase: “A new Metro Vancouver Congestion Improvement Tax would be applied as a 0.5 per cent sales tax on the majority of goods and services that are subject to the Provincial Sales Tax and are sold or delivered in the region.”

That wording will make it all but impossible to evade the half per cent tax by buying a new car in Abbotsford, for example. The tax will be applied depending on the address of the owner, not where the car is bought. That will be the case with any item purchased which is subject to registration with the province, such as boats, motorcycles or off-road vehicles.

That will ease the concerns of organizations like Greater Langley Chamber of Commerce, which has taken a stance against the congestion tax due to its effect on Langley businesses.

The column also drew a response from Bill Tieleman, who is heavily involved in organizing the “yes” side in the referendum. He was, of course, the organizational genius behind the petition against the HST, which succeeded, despite heavy obstacles. It set a new benchmark for citizen engagement on tax issues in Canada.

He said it is a virtual impossibility that the .5 per cent tax could later be boosted to a higher level. The province is keeping it separate from the rest of the PST, for starters, and wording of specific legislation, including that setting up TransLink, will make such a move very challenging. It would require approval from the province and likely from mayors as well.

He agrees with me that the biggest obstacle to a “yes” vote is TransLink’s poor reputation, and I suspect that the early stages of the “yes” campaign will focus on the improvements that people will see for the additional taxes they pay. He noted that the mayors specifically want a yearly audit of how the additional funds are being used, to ease concerns about mismanagement.

These measures will likely bring over some who are on the fence, but it seems that TransLink has to demonstrate that it is prepared to do things differently right away. There needs to be some significant pay cuts for senior management and the unelected board.

There also needs to be a commitment to negotiate a new contract with TranLink Police that is much less generous, in respect of both extra pay on Sundays and double dipping (current TransLink Police officers drawing pensions from previous public service jobs).

I agree with him that most Metro Vancouver residents would like to see better transit and less congestion. Their trust in TransLink to deliver on its pledges is minimal at this stage.

Langley Times