Friday, August 20, 2010

Decision on the HST Petition

You can find the full text of the decision by the judge Robert Bauman at this link.  It is a short decision and therefore a quick read.


These two early paragraphs speak the heart of the decision:
[4] The issue then squarely arises: Does this exercise in grassroots democracy founder on a strict interpretation of the legal requirements which must be met to set it in motion under the RIA?
[5] I have concluded that it does not, that the Initiative Petition complies with the spirit and letter of the requirements under the RIA on a proper legal construction of those requirements and that the CEO was correct in his decision approving it under the legislation.

The judge finds that because BC and Canada signed an agreement,The Comprehensive Integrated Tax Coordination Agreement, there is an area of jurisdiction for the Province.  I find the logic used by the judge a little bit stretched, though it can work if one uses the termination process in Part XV.   The idea is that if BC government revokes involvement in the CITCA then the HST by extension ceases, though the process within the agreement takes 18 months after the start of the next quarter.  The problem is that this can not occur before July 1st 2015 and then the 18 months kicks in.   By the letter of the agreement it would take till January 1st 2017 for the HST to be gone.

I think the HST could be terminated earlier than the start of 2017 if BC is in breach of the CITCA, though Canada would have to give notice and BC would have to do nothing for six months and then it still takes at least one more year for the HST to come an end.   All this depends on Canada objecting to something BC is doing and I am not sure what that would be.

The most interesting aspect is that the judge places the responsibility for making a better version of the HST Extinguishment Act on the legislature.   This means that the committee reviewing the act has a responsibility to make the act workable, this will give them something to do.   It also will make them the bad guys if they do nothing or they mess with the intent of the act.  It is not something I expected.
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