Should Stephen Harper forgive B.C.’s $1.6 billion HST debt?

While New Democrat MPs in B.C. are publicly calling on Stephen Harper to forgive the province's $1.6 billion HST obligation, their Conservative counterparts remain silent.

On Friday, after the results of a province-wide referendum axed the HST, B.C. Finance Minister Kevin Falcon told reporters his government would pay back Ottawa the $1.6 billion it was was given to harmonize the GST and PST.

"We will be fulfilling our obligation to return the $1.6 billion of transitional funding that will be subject to negotiations and discussion," he said.

"I am not going to have public negotiation, but we will honour the commitment we made to keep our part of the bargain."

Through a spokesman at the Ministry of Finance, the feds have said they expect B.C. to return the money.

The federal New Democrats, on the other hand, buoyed by their caucus of 12 B.C. MPs, are demanding the Harper government stop its plan to "punish British Columbians for rejecting his attempt to raise taxes on almost everything they buy."

"Small businesses of all types suffered significant losses due to the HST," NDP MP Don Davies noted as part of a party press release.

"It would be both spiteful and damaging for Harper to now force B.C. to pay back $1.6 billion, after it was already invested in things like health care and education."

Columnist Barbara Yaffe doesn't think B.C. should be forced to pay back the money either and suggests the province's "weighty federal cabinet contingent" should be making a case to Harper that the money be forgiven.

After all, she says the Tories are culpable.

"Ottawa bears as much responsibility for the current HST mess as the province . . . federal Conservatives and provincial Liberals worked hand-in-glove to introduce the harmonized tax in B.C.," she wrote in the Vancouver Sun.

"The point that needs to be made to Ottawa is that the HST was indeed implemented in B.C. in 2010. The adjustment costs, in fact, were fully borne. Why on earth would B.C. now be expected to refund the money?"

Yaffe adds that while the Conservatives pushed the provincial Liberals to implement the new tax, they did very little to help sell it during the referendum.

"In demanding repayment, the Harper Conservatives will be making a bad situation worse for British Columbians.

"It's a mean posture for a government that owes so much of its political success to B.C. voters."

(CBC Photo)