Pay parking tax may drop with HST defeat

Possible seven per cent reduction at paid lots not yet certain

The demise of the harmonized sales tax may mean a seven-per-cent break for motorists who use Metro Vancouver pay parking lots – depending on what the province decides in the months ahead.

TransLink tripled its tax on pay parking to 21 per cent in January 2010 and the switch to the HST that summer charged 12 per cent on top.

The compounding effect means motorists currently pay an extra 35.5 per cent in tax at paid lots.

But the end of the HST may mean only the five per cent GST will apply on top of TransLink’s 21 per cent come the spring of 2013.

“There’s no doubt in my mind,” said Charles Gauthier, executive director of the Downtown Vancouver Business Improvement Association.

“If we’re going back to the old system, I would imagine the PST doesn’t exist for pay parking.”

He said the government made it clear with the change to the HST that the province was handing its taxing authority over parking to TransLink, meaning there should be no scope for a reintroduction of a provincial tax.

If so, the province would lose the seven per cent provincial component of the HST it now receives – worth close to $20 million a year. That’s actually money the province never got to keep prior to the HST, because the PST was previously remitted to TransLink.

TransLink officials say they’ve asked the province what’s planned but received no answers yet.

A finance ministry spokesman said the issue isn’t decided, adding it’s one of numerous decisions the government faces in the months ahead as it prepares for the dismantling of the HST.

TransLink collected $58.4 million last year from its 21 per cent parking tax.

Prior to 2010, parking taxes totaled 12 per cent, with seven per cent collected by the province going to TransLink and another five per cent in GST going to Ottawa.

TransLink spent money setting up its own tax collection system after the province stopped collecting the provincial tax.

Gauthier said some downtown workers doubt any cut in taxes would actually be passed on to them by parking lot operators.

He also noted the higher taxes on pay parking in recent years have spurred many people to take transit or find other alternatives to driving downtown.

@jeffnagel

 

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