Campbell’s income-tax-cut gambit won’t pay off

Gary MasonPublished Friday, Oct. 29, 2010 9:19PM EDTLast updated Friday, Oct. 29, 2010 9:29PM EDT4 comments

It was hard not to notice: the Premier of B.C. on a popular radio talk show sounding every bit like a politician in the throes of a bitter election campaign.

“We’ve created 400,000 jobs since 2001,” Gordon Campbell said on CKNW’s Bill Good Show this week.

“Our personal-income-tax regime is the lowest in the country … We believe that a strong private-sector economy is what supports important public services like health care and education … The NDP Opposition is opposed to income-tax cuts, is opposed to more take home pay for people.”

What is odd, of course, is that Mr. Campbell won his third provincial election only 17 months ago. The next one isn’t scheduled to be held for more than two years. So what was he campaigning for?

His political life.

The Premier bought $240,000 worth of television time this week to announce a 15-per-cent income-tax cut that was universally viewed as an attempt to blunt criticism he is taking over the HST. That’s not to say that most economists don’t think the tax cut is a good idea. They do.

However, there are few who believe it would have been introduced now or in this manner in the absence of the HST revolt the Premier is facing. Tax measures are almost always set during provincial budgets – or dangled as carrots during election campaigns.

But Mr. Campbell couldn’t afford to wait for 2013, when the next election will be held. He needed something to offer voters now, well in advance of the HST referendum that will be held next September. Will it be enough to win over voters’ affections for the harmonized tax?

I suspect that as much as those who benefit from the new tax cut will gratefully accept the extra cash they’ll now have to stuff in their pockets, they are unlikely to show the Premier their gratitude in any way. The last round of polling showed Mr. Campbell’s personal popularity at 9 per cent and while he might get a small bounce from his tax-cut gambit, it will not be enough to deflate the growing consensus that his time as premier in B.C. is coming to an end.

The public fundamentally distrusts the man. Poll after poll shows that British Columbians believe Mr. Campbell lied to them about when he had decided to bring in the HST, despite there not being a shred of evidence to support that view. It has become accepted wisdom and no matter how many times he tries to explain the sequence of events that led to his decision, it doesn’t matter.

His critics point to Ontario Premier Dalton McGuinty, who also introduced the HST, but apparently did it the right way, by consulting the people of Ontario first. Of course, Mr. McGuinty did no such thing. He floated the idea of introducing the HST as a trial balloon a couple of months before introducing the tax. That’s consultation?

This idea of consultation is one of the most laughable aspects of this HST debate. What government ever seeks permission from the public to raise their taxes? I attended some of the town hall meetings that the government held on health care. They were all hijacked by those fighting for the status quo. Don’t change a thing and don’t raise MSP premiums. How you find the money to pay for it all is your problem, government.

Town hall forums on the HST would have produced the same effect: the majority turning out would have been those most vociferously opposed to the tax.

The Premier told Mr. Good that he plans to stick around to fight another election. “I don’t think many people have said I’m a quitter,” he said. Well, he may not have a choice.

All indications are Mr. Campbell is damaged goods, political toxin. He will stick around through the HST referendum because to hand this problem over to a new leader now would be political suicide and deeply unfair. Mr. Campbell created this crisis and it’s only right he sees this it through to its conclusion, whatever that may be.

Many believe the HST vote is as much a referendum on the Premier’s leadership as the tax itself. If that is the case, we’ll likely know well in advance how that vote is going to turn out.

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