Another reply to John Richards
by Tom Syer
The Harmonized Sales Tax catalyzed one of the most interesting political and policy debates in British Columbia’s history. While more will be written on the HST over time, the post-HST analysis has not provided a thorough discussion of the referendum process and outcome.
In the Winter/Spring 2013 issue of Inroads, John Richards raised the question of the merits of direct democracy in making tax policy – a bad idea in his view. On the opposite side, Richards’s colleague at Simon Fraser University, Doug McArthur, writing in Policy Options (November 2011), made a case for the referendum process: voters understood the HST well enough and the government “debacle” in introducing the HST justified the HST referendum and outcome. In McArthur’s view, this was an effective example of direct democracy.
As I see it, neither of them has it quite right. Both gloss over important process and outcome considerations that shine more light on a crucial question: Can there be sufficient “informed consent” among voters in questions of major tax policy reform to justify a limited use of direct democracy?
The debate around the HST has been framed in terms of dichotomies: Is direct democracy good or bad for tax policies? Should we have a value-added tax or not? Did the Campbell government deceive British Columbians before and after the 2009 election? To my mind, all of these dichotomies miss important questions of policy process and outcome.