Coping with the GST

A post-election look at Canada’s most hated tax

he Goods and Services Tax (GST) was T first implemented roughly three years ago by the now-deposed Progressive Conservative government. Since its concep- tion, this tax has prompted serious arguments as to how beneficial it is to the Canadian consumer and the economy as a whole.

The Conservatives introduced this tax to replace an earlier tax that wassaid to be out- moded or antiquated. The old tax was basically more subtle than the GST, which produced a hostile public reaction. The GST is a surface tax in the sense that its seven percent charge is applied to the purchase of most goods and services, many of which were exempt from taxation in the past. The GST has exemptions and a rebate guarantee which would appease Canadians to some extent, but for the majority of the public the old adage of grin-and-bear-it was the rule.

Where does that leave us today? After the defeat of the Conservatives, people are left wondering whether the Liberals will keep the GST. Many Canadians expect the Liberals to pursue the policy started by the Conservatives, thus continuing the unprecedented tax on books, including university texts.

The manager of the U.P.E.I. bookstore, Russell Stewart, perceives the tax as an unfair burden on students, who already have enough

Business as usual at the UPEI Bookstore

financial considerations of their own. Mr. Stewart can sympathize with the students’ con- cerns, but is in no position to ban the tax from the bookstore. He must obey the policies insti- tuted constitutionally by law.

From the students’ perspective, the GST and its tax on books (among many other things) creates further complications in addition to such problems as:rising tuition costs, cost of living, and a general feeling of financial de-

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spair. Still, there are other factors to consider apart from the costs to students. Though the tax is unpopular, if eliminated the revenue it now generates would have to come from somewhere else, possibly in the form of cutbacks in the civil service, medicare, social security, and unem- ployment insurance. Ifthe tax is to be replaced, there must first be a viable economic substitute

GEORGE ANDERSON

8/X-Press/November 4, 1993