Chapter 6

http://www.vancouversun.com/news/sinks+TransLink+million+hole/1961458/story.html

Summary
This article informs about the dilemma Harmonized Sales Tax (HST) will bring to TransLink’s future financial plans. TransLink had planned on relying to enhance a tax on commercial parking spaces, which would bring in $18 million a year to raise $57 million annually. However, because the parking tax is a sales tax, it is to be eliminated and combined into the HST when it initiates next July 1. This causes the Translink and the transportation ministry officials to have a problem to find a solution to fix this predicament. This article further explains that if the situation is not solved by the time Translink’s mayors’ council chooses among other financial options this fall, the transportation authority may have to result to a base plan that requires it to make drastic service cuts. The mayor’s council has chosen two of the many other financial options: A “funding stabilization” plan that minimizes service cuts but would require $130 million a year more in funding, or a “maintain and upgrade” plan that would strengthen existing service and lay the groundwork for expansion. However, it would require $275 million a year more than the base plan, and it also includes a vehicle levy.

Connection
This article connects to chapter six because chapter six is mainly about the GST and PST, which has been placed by the federal government and the provincial government. The GST taxes on the supply of most goods and services, while the PST base mostly on the price of goods sold to a customer. However, the HST (7%) which is the combination of the GST (5%) and the PST (7%) is supposed to make it more convenient for individuals especially for businesses because businesses will only have to collect one tax instead of two. However, the HST is causing the Translink to lose money after spending numerous amount of it to build new sky trains and sky stations instead of helping the Translink to make profits.

Reflection
I was quite surprised when I heard about HST, and I did not quite understand why we need to form a new tax, when we have been completely fine with GST and PST all these years. In my perspective, with the economy doing so poorly right now, creating HST is not the best choice to help the economy, and the Translink is a perfect example. The Translink have spent millions of dollars in order to provide and make better transportation, and with the HST in the way, how do the Translink make profit. If the “funding stabilization” plan, or the “maintain and upgrade” plan were to happen, we as British Columbians will have to be the ones to pay for the millions of dollars in the future.