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NCDA of BC Recommendations for Economic Recovery

NCDA of BC Recommendations for Economic Recovery

June 22, 2020

As our great province moves into the next phase of restarting the economy, the New Car Dealers of BC can be a significant part of the solution. In early June I had the privilege of meeting with the BC Legislature’s Select Standing Committee on Finance & Government Services, as part of its pre-budget consultation, to discuss the ways in which the BC’s New Car Dealers can help drive BC’s economy – should the government accept our recommendations to move forward.

There are a few recommendations related to further incentivizing consumers and addressing key obstacles that will help to drive local economies across the province. Let’s take our foot off the brake and put it down on the accelerator!

Firstly, we recommended adjustments to the luxury tax on vehicles, which currently applies to all vehicles over $55,000.  Right now, BC car buyers pay 7% PST on vehicles priced below $55,000. That rises to 8% for vehicles priced between $55,000 and $55,999, then to 9% on a price of $56,000 to $56,999, and then 10 percent on vehicles over $57,000.

In 2018, an additional supertax was added for buyers of vehicles with Manufacturer Suggested Retail Price (MSRP) between $125,000 and $149,000 requiring 15% PST, and cars priced at $150,000 and higher come with 20% PST. These luxury surtaxes have had an unintended consequence of a 33% decrease in PST, as many buyers make their purchases out of province. More urgently, we again recommend that the Government take the luxury tax off of pick up and work trucks. It just doesn’t seem right that you can buy an $88,000 watch and not pay luxury tax, but if you need a $65,000 pick-up truck for work or your lifestyle, you have to pay luxury tax. Let’s get our priorities right!

We’ve also recommended further funding to the highly successful CleanBC-Go Electric Vehicle Purchase and Scrap-It BC programs, to incentivize consumers to purchase greener vehicles. BC’s electric vehicle adoption was the highest in North America in 2019, with 10% EV sales compared to all new vehicle sales – compared to 7% in Quebec and 8% in California. We recommend additional funding to continue this trend and encourage British Columbians to get moving again.

Finally, we’ve recommended the continued investment in skilled trades training in the province. More and more consumers are choosing to drive EV’s, and cars and trucks are becoming more technically complex, so it is imperative that continued funding goes into programs like the newly developed EV Maintenance Training Program at BCIT. Programs like these will continue to drive workers into the automotive trade and ensure they have the necessary skills and training to properly repair these vehicles.

The automotive industry is a significant driver of the economy in British Columbia and through these added efforts we can work to put the pedal to the metal and rev-up our economic recovery.

Stay safe out there and remember to follow all health guidelines as BC moves into Phase 2 of its Restart Plan.

Blair Qualey is President and CEO of the New Car Dealers Association of BC. You can email him at bqualey@newcardealers.ca


Dealer Members with New Car Dealers Association

We represent more than 390 New Car Dealers throughout British Columbia.