A couple of things I wanted to quickly highlight in the wake of the HST’s defeat earlier this month.
1) Further to my earlier point about the HST’s impact on the province’s investment climate, here’s Don Cayo in the Vancouver Sun:
Craig Williams, vice-president for B.C. of the Canadian Manufacturers and Exporters Association, tells me his group looked in depth at a few companies to see what the HST-PST switch will cost. The average, he said, is about half a per cent of the product’s price.
This may not sound like much, and it might not make much difference if it’s a product sold locally in competition with other companies that face the same costs.
But it’s a lot when you’re trying to sell into competitive export markets – as is the case for about $28 billion of the $40 billion worth of things made in B.C. each year. And it’s a lot when you have to compete in your domestic market against outside manufacturers who don’t have that cost.
Big companies wondering where to set up shop are keenly aware of this. Williams told me several such companies have held off on location decisions while awaiting the result of the HST vote.
So it’s not for nothing that Ontario Finance Minister Dwight Duncan is toasting the result of B.C.’s vote. His HST-collecting province – and a host of other jurisdictions worldwide – have just been handed a significant competitive advantage over us.
The HST issue, meanwhile, is still a political issue in Ontario – albeit, a milder one.
2) I thought this bit of analysis by Stephen Gordon for the Globe and Mail was worth sharing:
For an economics professor who has spent much of the past six years trying to bridge the wide — and apparently broadening — gap between what is known to economists and the talking points that are the stuff of politics, the B.C. HST referendum is an unsurprising disappointment.
It is unsurprising, because economics’ collection of challenging and often counter-intuitive ideas has been and probably always will be difficult to communicate to the general public. But it’s still disappointing: as long as this state of affairs persists, economic policy debates will continue to take place without the meaningful participation of much of the citizenry.
Still more proof that this was never about the taxes. The BC Liberals needed stomping, and this was the issue that they got stomped on. Economics wasn’t really a factor, much as many economists might have tried to make it one ( with some exceptions ).
3) Just for kicks, here’s an old column that I wrote ( well, a copy of it anyway ) in the wake of the HST announcement back in 2009 ). Geez, time flies.