The B.C. government is coming under fire for a tax hike critics say was hidden in last week's budget.
Quietly buried in last week's budget was an announcement to raise the PST on the private sales of vehicles, boats and aircraft. The move, which takes effect the same day as the HST on July 1, will see the tax raised from its current seven per cent level to 12 per cent. The move will net Victoria millions of dollars in tax revenue from British Columbians.
But many people didn't hear about it. Instead of calling a spade a spade in the budget, the government only said it would:
"Continue [the] provincial tax on private sales of vehicles, boats and aircraft, but at 12 per cent."
Bruce Cran of the Consumer Association of Canada says the increase is a clear example of lack of government disclosure.
"There was no transparency here."
But Minister of Finance Colin Hansen insists the raise was in plain view.
"Anybody that read the budget speech or listened to the budget speech would know I explicitly referenced this change," he told CTV News during question period at the B.C. legislature.
Clear or not, Hansen says the hike is coming, meaning British Columbians will soon have to pay more if they're buying a used vehicle.
Tsawwassen resident Peter Jeffs is selling his 2006 Mazda. He's hoping to make the sale before the tax takes effect, or risk making less from the sale.
"I'd be picking up the tab for some of that," he said.
Under the current tax rate, buying Jeffs' Mazda for $14,000 would mean $980 in PST. After July 1, the buyer would have to shell out an extra $700.
That number gets much bigger as the price tag gets higher. A $40,000 BMW would cost an extra $2,000. And someone buying a $200,000 cabin cruiser boat will need to shell out an additional $10,000.
Cran says the tax hike will fall directly onto the shoulders of consumers.
"In the end in think you have to look at this as a tax grab. It's a blatant tax grab."
Hansen says the tax will put B.C. on an even playing field with other provinces that already have harmonized sales tax. The Liberals also stated the hike would put private sellers in the same position as HST registered businesses – namely auto dealers who already pay a higher tax rate to the federal government.
With a report from CTV British Columbia's Stephen Smart