In the end a narrow loss for HST in B.C. referendum

August 26, 2011

Public Opinion, Public Policy

Question: do we celebrate the referendum results in BC as a victory for democracy? As the ultimate in public consultation the referendum was a decisive public expression. Or was it? And, how decisive and meaningful are these votes.

Stepping back. The referendum was the result of an organized campaign that resulted from the surprise announcement after the 2009 provincial election that the province would be moving to harmonize is provincial sales tax with the federal goods and services tax. Recalling that no one likes new taxes (and the GST was hated when it was proposed back in the 1980s), it is not surprising that public anger emerged.

Opponents of the HST successfully raised enough valid signatures to force a referendum vote on the following question:

Are you in favour of extinguishing the HST (Harmonized Sales Tax) and reinstating the PST (Provincial Sales Tax) in conjunction with the GST (Goods and Services Tax)?   Yes/No

Polling leading up to the referendum in British Columbia, which occurred in June and July, by means of a ballot indicated that the public was going to reject the HST in favour of a return to the combination of the PST and GST. What is interesting about the findings is that in the previous year, “yes” support (those opposed to the HST) actually declined significantly. Public anger was clearly declining.

In the end, 1,610,125 people cast a ballot and 54.7 per cent voted Yes (details here). So, the polling results were in line with the outcome. But, going back to our original question, is this a victory for democracy.

My Answer:

It is a positive expression of democratic principles but the referendum process reduces complex policy decisions to a simple yes-no votes and ultimately speaks to the failure of the political class to effectively govern.

On a positive side, the referendum drives everything to a single decision-point. This encourages people to get informed by linking their learning to a clear decision. We can’t possible be informed on everything and knowing we have to make a decision on a particular day can motivate us to focus on that issue.

But, consider the following:

  • Turnout was low: 1,610,125 people voted in the referendum. If we use B.C. elections estimates for the number of eligible voters in the 2009 provincial election as a conservative base, this means that 49.7% voted. Less than half of the province decided the fate on this issue.
  • The evolution of opinion: Since public anger had clearly gone down (perhaps because many saw reversing the decision as impractical; or once implemented did not oppose it), one wonders if the issue really warranted a referendum. A referendum that could  originally be positioned as a rejection of “out-of-touch” politicians, was fairly close.

The fact that there was a referendum speaks as much to the failure of the Campbell government to lay the groundwork for the tax change and this failure will now have significant long-term implications for tax policy because the “public,” or about half of it, have spoken.

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About Richard Jenkins

Market research professional and small business owner

View all posts by Richard Jenkins


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