Wednesday, February 24, 2010

Times Colonist: Strata owners to launch petition against HST

Strata owners to launch petition against HST

Group fears condo owners will be hit harder when tax starts July 1

Another arrow has been added to the quiver of those fighting the harmonized sales tax, as a group of strata owners have come together to launch a petition against the tax.

With the help of Lana Popham, the NDP MLA for Saanich South, Harvey and Barb Freedman have launched an online petition ( and will hold a meeting tomorrow night to spur other strata owners to action.

Harvey Freedman is encouraging other owners to join the Fight HST campaign led by former premier Bill Vander Zalm, who is attempting to kill the tax via an initiative petition. Freedman said the meeting will focus on explaining that strata owners are going to be hit harder than single-family homeowners when the 12 per cent HST is introduced July 1.

Freedman estimates owners in his building "can expect to pay an additional $280 per annum, all of it due to increased provincial taxation."

He noted strata owners will have to pay more in maintenance fees because of the tax and have to conduct audits and do depreciation studies, which will be subject to the HST.

"This cruel tax is inflationary and will hit everyone in B.C.," he said. "There's a harder hit to condo owners because of the additional services they are obliged to have by law."

But Tony Gioventu, executive director of the Condominium Home Owners Association, said it's far too early to say with any certainty what impact the HST will have on strata owners.

"It is so variable, some strata corporations will see zero impact and some will see an impact as high as three to four per cent, and some [large mixed-use strata buildings] which charge HST on fees will be able to claim and get rebates so they will [come out ahead]," he said.

Gioventu said as a result it's impossible to put a dollar figure on the impact of the HST on the average strata owner. But he was adamant it would be well below $280 a year.

"A strata corporation would have to have 100 per cent of their budget to be labour-related in order to feel the maximum seven per cent impact of the HST on fees," he said. "Worst-case scenario most corporations are at 20 per cent [of their fees for] labour. In the maximum case I expect the scenario might be a 3.5 per cent increase."

Gioventu also pointed out depreciation reports and audits are not yet required.

"They are a possible regulatory requirement the government may bring in, but it won't bring them in until a public consultation process takes place over the next year," he said, noting even then there's no guarantee those studies will be subject to HST.

Tony Davis, president of the Vancouver Island Strata Owners Association, said the tax has not been top of mind within the association though they are concerned about its impact.

"We agree it will have an effect on strata owners, particularly to their maintenance fees and if they have management companies that will also increase, but it's a bigger issue than just strata owners. It will affect everybody," he said.

Popham, who will present the online petition to the legislature, said while the increase in costs to strata owners may not be a lot annually, it does add to the financial burden.

"It's another added cost on top of all the other added costs HST will have on daily living," she said, noting it will have a significant impact on those people living on fixed incomes and younger people. "All these things add up."

Tomorrow night's information meeting for strata owners is set for 6:30 p.m. at 3962 Cedar Hill Rd.