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Colby Cosh: Saskatchewan tax changes help farmers, at the expense of Rider fans

The government made a political decision that clipping event-goers was a smart idea if they’re going to a Rider game or a country-music concert, but that it didn’t want to apply the same burden to minor hockey, piano lessons or gyms

No mad rush for playoff tickets
Photo by Don Healy/Leader-Post

My sympathies go out to the residents of Saskatchewan, who are facing a new variety of taxation beginning Saturday. In the spring budget, the Saskatchewan government announced that it would be expanding its provincial sales tax, whose current rate is six per cent, to event tickets and admission fees that were previously untaxed provincially. This means that things like concerts and curling-club memberships will be six per cent more expensive.

And the tax applies to attendance at Saskatchewan Roughriders games, which are practically a sacrament in the province. The government expects to collect about $21 million a year from the PST expansion, and roughly $1 million of that is likely to be provided by Rider tickets alone.

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Viewed from my vantage point in Alberta, where provincial sales taxes have been taboo for a century, the whole exercise is interesting in a nerdy medieval way. The spring budget rejigged the fine complex details of the PST to give Saskatchewan farms some marginal tax relief (to the tune of roughly $1 million overall). Insulators for electric fences, for example, were moved into the exempt category. Portable seed cleaners became exempt when a farmer buys them for his own use, but still taxed for those who have a seed-cleaning side business.

The new breaks for farmers are dwarfed by the new entertainment taxes, which Saskatchewan’s finance minister, Donna Harpauer, sold to the public as being a measure to reduce surgical wait times. The additional amounts collected do happen to match up with health spending pledges (ones that might or might not work to improve access), but of course it’s all general revenue, and the wait-time pretext will no doubt be forgotten in a matter of months. Harpauer, interestingly, also brought out a tax-harmonization pretext for the move, even though Saskatchewan doesn’t subscribe to interprovincial tax harmonization. Moreover, the farm equipment changes pull in the opposite direction — away from angelic harmony.

The additional entertainment and admissions taxes will make the base for the PST a little more like the base for the GST. In general, anyone charging GST on tickets or entry fees will now be charging PST as well (and will have to register). But if you study the tax circular that Saskatchewan sent out to discuss the details, which was still being revised as late as last month, you get a terror-inducing glimpse of accounting hell. Or, as it’s generally known, “accounting.”

There’s a basic list of charges now subject to PST: sporting events, concerts, theatre and museum admissions, “public seminars and events,” entry fees for escape rooms, batting cages, go-kart tracks, etc., ad nauseam. Then we plunge into the weeds. Amateur events held by a “public sector body” (a term including any non-profit) are exempted from applying PST to ticket charges. This involves finding out whether “90 per cent or more of the performers, athletes or competitors are not paid directly or indirectly for their participation other than by government and municipal grants, and reasonable amounts as gifts, prizes or compensation for travel or other incidental costs.”

Admission charges for volunteer-run casinos and bingos are exempt if they’re held in a church basement, but not if they’re in a tent or a brick-and-mortar casino. Youth sports fees are exempt; so are gym memberships, for all ages. One-to-one “classes” and “lessons” are exempt, even though public lectures and seminars aren’t. Promotional giveaway tickets to events are taxed. Facility rentals aren’t taxable, but golf course fees and bowling lane rentals, we’re advised, aren’t “rentals” under the law. I don’t wanna be the tax guy who has to explain that one to a client.

Basically, the Saskatchewan government seems to have made a political decision that clipping event-goers was a smart idea if they’re middle-class individuals going to a Rider game or a country-music concert, but that it didn’t want to apply the same burden to minor hockey, piano lessons or gyms. The absurdity of invoking “harmonization” with a federal sales tax already full of inherent complexity — since the GST is only supposed to apply at one point of the value addition chain — is pretty self-evident.

Consumption taxes are considered to be the best kind overall because they are stable and efficient; shifting the burden of taxation away from incomes and onto sales and fees is generally thought by economists to be the work of God. But I have to admit that income taxes have an attractive one-dimensional simplicity if you’re a middle-class person who has limited strategies for avoiding them (beyond buying too much house for oneself, which is every Canadian’s God-given right). By contrast, sales taxes have an unfortunate tendency to accumulate awkward little boutique features that must cost a fortune just to write down, let alone learn and obey.

National Post

  1. Minister of Finance Travis Toews delivers the 2021 Alberta Provincial budget at the Alberta Legislature, in Edmonton Thursday Feb. 25, 2021.

    NP View: Alberta is no place for a sales tax

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