Recreation programs set to jump with HST

Kelowna Daily Courier June 16
Taking recreation programs at the Parkinson Rec centre or booking city-owned facilities will cost seven per cent more on July 1. Introduction of the harmonized sales tax will affect some city services, but not others, council heard Monday. But staff want the public to know the controversial HST does not represent any additional revenue to the City of Kelowna, with all the extra tax simply being passed on to senior governments. "The city is not gaining any additional revenue from the HST," staffer Genelle Davidson told council. Coun. Charlie Hodge said the question was "begging to be asked" what would happen if the city refused to collect the HST, an apparent reference to the groundswell of opposition to the new tax. "As a municipality, we really have no choice," but to collect it, Davidson, manager of financial systems and reporting.

Some city services that are currently exempt from taxation will continue to be so, so the 12 per cent HST will not be charged. These include transit passes, landfill charges and library services. On the other hand, introduction of the HST will result in a seven per tax tax increase for some services that currently attract only the five per cent GST. These include enrolment in recreation programs, facility rentals and parking charges.

For most of these services, the taxes are on top of the fee charged by the city, so users can see exactly how much the service costs, as well as the applicable taxes. For parking meter and parkade charges, however, the tax is embedded for simplicity‘s sake in the fee paid at the meter or entrance. So boosting the tax from five to 12 per cent on the total amount collected in parking charges will have the effect of slightly reducing the revenue collected by the city.
Council will get a full report later on the precise impact of the HST‘s introduction on parking revenues. One option to deal with the loss in revenue would be for the city to increase parking fees.
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Don Quixote Note: Vernon has the same problem with GST being embedded within the parking meter fee and maybe several other revenue sources. I have questioned this at Finance Committee and Council level several times and staff is researching our potential loss revenue and the remedy.