WHEREAS the City of Prince Rupert pays approximately 300,000 annually in Provincial Sales Tax on goods and services acquired for direct use in the delivery of municipal services and in capital infrastructure improvements; AND WHEREAS the provincial government is continuing to improve its financial picture and has reported a surplus in excess of 2 billion without any significant corresponding change in revenue sharing between the Province and local governments, yet the federal government has already decided to eliminate the Goods and Services Tax on purchases by local governments: THEREFORE BE IT RESOLVED that all local governments request that the Province of BC immediately and permanently eliminate the Provincial Sales Tax on purchases by local governments; 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 local governments, nor should such exemption be seen as an opportunity to download additional responsibilities to local governments without providing sufficient funding to compensate for such additional responsibilities.
Ministry of Finance The Province has traditionally chosen to support municipal governments in ways other than through sales tax exemptions because they complicate the tax system and set precedents that could ultimately reduce the effectiveness of the tax as an important provincial revenue source. Municipal governments have received significant financial support from both senior levels of government over the past year. On the federal side, the GST rebate for municipalities was increased to 100 percent, and a portion of federal fuel tax revenue is being shared. Recent provincial support includes: - the transfer of 100 percent of traffic fine revenue to 70 local governments for community policing, crime prevention and other initiatives to help make communities safer; and - the 80 million British Columbia Community Water Improvement Program to help ensure safe, reliable and accessible drinking water and improved waste water systems.