By Don Cayo December 13, 2009

A 21-per-cent sales tax on parking fees in Metro Vancouver, due to kick in Jan. 1, will not go away when the 12-per-cent HST comes into force on July 1.

So the new total rate will be 33 per cent.

This huge hit was by no means obvious when the province announced two weeks ago that the long-standing tax on parking would triple from seven to 21 per cent. After all, this tax is a product of provincial sales-tax legislation, and for years the B.C. government has called it PST.

And the province now has a deal with Ottawa in which it will be paid $1.6 billion to drop all PST and adopt the HST as of July 1.

Up to late Friday, people in the parking industry were telling me they had no idea if the two taxes would be stacked or not. Spokesmen for both TransLink and the B.C. Ministry of Finance also said they didn’t know.

Then Finance Minister Colin Hansen called to say that the tax has been misnamed all these years — it’s really a “transit tax.” And it will be staying at whatever rate TransLink wants, up to 21 per cent, which is the upper limit set by law.

He said he didn’t know if this could be done under existing law, or if it would require an amendment when a package of HST legislation is passed in the spring. But either way it will be done, he said, to honour the province’s promise that TransLink can have the revenue the tax will raise.

I was able to find several documents on the ministry website referring to the parking tax as PST. Even the first sentence of the ministry’s latest tax notice — the one raising the rate from seven to 21 per cent — says, “The provincial sales tax (PST) rate on the purchase price of parking rights will increase from 7% to 21%.”

But neither Hansen, nor his department’s spokesman, nor TransLink’s, could point me to anything that said the tax on parking is anything but PST.

As for it being a “transit tax” as the minister said it should be called, a search for that phrase on the ministry’s website yielded just five hits, none of them dealing with tax on parking. Despite his determination to legislate whatever it takes to ensure this tax remains beyond July 1, and despite the difficulty he and the agencies involved are having in providing any justification for his view that it is something other than PST, the minister was very clear in maintaining that the parking tax should be seen as TransLink’s doing, not his.

In our eight-minute chat, he underlined this theme time and again. “There will be a big new tax that TransLink has decided to impose on parking” [my emphasis], he said.

Then he added much the same thing several times over. And he disputed my suggestion that the size of this tax hit will foster more wrath toward a government that’s already deeply unpopular for the way it is implementing the HST.

“People recognize this is a TransLink decision,” he said. “It’s not a Province of British Columbia decision.”

So the short story is that for years the taxman said the levy on parking was PST. Now — Presto! Change-o! — the minister says it’s not.

This means if you park in downtown Vancouver, at a hospital or university, or anywhere in the Metro region that has paid parking — even at a TransLink-owned park and ride — you will pay more.

A lot more.

Hansen thinks you’ll blame TransLink. What do you think?

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