WHEREAS the provincial government has promised new revenue sources for local governments and has suggested a partnership approach between the Province and local governments to better serve the needs of our citizens; AND WHEREAS the federal government, through its recent GST exemption for local governments, has recognized the need for senior level government financial support for communities who are facing ever-increasing demands for services, some of which are a direct result of federal and provincial government cutbacks: THEREFORE BE IT RESOLVED that the Union of BC Municipalities approach the provincial government to immediately exempt local governments from the payment of Provincial Sales Tax; AND BE IT FURTHER RESOLVED that such exemption should not result in any reduction of grants in lieu or any other monies presently directed from the provincial government to municipal governments, nor should such exemption be seen as an opportunity to download additional responsibilities to municipal governments without providing sufficient funding to compensate for such additional responsibilities.
MINISTRY OF FINANCE The Provincial Government consulted with local governments about the need for new revenue sources during the development of the Community Charter and found little local government support for new taxation powers. Since then the federal Government has increased the GST rebate for municipal governments from 57 to 100 and announced the transfer of a portion of federal fuel tax revenues for municipal purposes. Recent provincial government support to local governments includes: the transfer of 100 of traffic fine revenue to 70 local governments for community policing, crime prevention and other initiatives to help make communities safer; a new 80 million B.C. Community Water Improvement Program to help ensure safe, reliable and accessible drinking water and improved waste water systems; and the establishment of the Premiers Task Force on Community Opportunities that will, as part of its mandate, consider revenue sharing for local governments as an incentive to undertake activities that contribute to the provincial economy. British Columbias policy regarding the application of sales tax to local governments is, with very minor exceptions, consistent with most other provincial governments, including those which have harmonized their sales taxes with the federal GST. No change to this policy is under consideration.