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PAULIE_D
Yet another example of the government going after the little guy. :sigh:

The province of Alberta does not charge any provincial tax. Residents of the neighbouring province of British Columbia which is highly taxed, frequently make the trek across the border to Alberta to shop and thereby save themselves a considerable amount of money.

The BC government is trying to force Costco to divulge member records so they can go after them for tax evasion.
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Victoria chases Costco's cross-border scofflaws

By GARY MASON

Thursday, January 19, 2006 Posted at 5:33 AM EST

From Thursday's Globe and Mail

E-mail Gary Mason Read Bio Latest Columns

VANCOUVER Attention shoppers. If you are a B.C. resident who recently purchased a $30 toaster at a Costco store in Alberta and didn't send Victoria a cheque for the $2.10 in sales tax you avoided at home, please be advised the government is on to you.

And it is determined to get its money.

In a move some suggest sets a new standard for mean-spirited pettiness, B.C.'s Liberal government is targeting residents suspected of avoiding taxes by crossing into Alberta, where there is no provincial sales tax, to take advantage of the many bargains offered by Costco.

And the government is demanding that the giant retail discount chain help nail the crooks by turning over the names and addresses of all its B.C. members who have shopped at its Alberta stores in the past several years.


Rick Thorpe, the often-abrasive Minister of Small Business and Revenue, has also requested details on any Internet purchases in which

B.C. customers -- who pay a 7 per cent provincial sales tax at home -- picked up their items in Alberta.

Costco, meanwhile, has filed a petition in B.C. Supreme Court seeking an injunction declaring the government's position illegal.

"Going after mom and pop who are trying to make the most of their after-tax dollars seems bizarre to me and the ultimate act of hypocrisy," said Sara MacIntyre of the Canadian Taxpayers Federation.

"Tell me, is the B.C. government going to start issuing refund cheques to people from Alberta who purchase goods and pay sales tax in B.C.? Not likely. But if you're going to start erecting walls around your province, it has to work both ways.

"This is a competitive issue with Alberta. Instead of going after folks who are trying to fix up their basement, the B.C. government should perhaps look at making their tax policies a little more competitive."

And that is just one aspect of this bizarre move by the B.C. government.

The bigger issue may be its decision to order Costco to turn over confidential client information. While B.C. residents living along the province's eastern border cross into Alberta to shop at any number of stores, the government has focused on Costco because it is a membership-based chain and, as a result, has a paper trail of client transactions.

The government argues that Costco is obliged to turn over the material under provisions of a provincial law that requires retailers to comply with requests for information on tax evasion. Costco argues that the request exceeds the province's authority and amounts to a gross violation of privacy.

Jim Sinegal, president and chief executive officer of Costco, says the privacy question goes to the very heart of his company's relationship with its clients. If customers thought the company was turning over private information about them to government, it would take an inestimable toll on the company's business.

"We're unique because we're one of the few businesses that have this information," said Mr. Sinegal. "And because of that we're being singled out. It's certainly not going to solve the government's problems. People will just go other places.

"But I think going after this information is really going to get people's backs up."

Mr. Thorpe, who has often railed against interprovincial trade barriers, was apparently too busy to talk with the media, so he had assistant Theresa Lumsdon relay three points in response to general inquiries about the matter: 1) "because the issue is before the courts the ministry can't comment on the privacy issue;" 2) "the whole initiative is standard operating procedure;" 3) "B.C. retailers along the B.C./Alberta border have been hurting and have been asking for this."

Actually, what B.C. retailers along the eastern border have been asking for is that their area be declared a no-sales-tax zone so they can compete with Alberta retailers. And while the government tries to justify its move by saying it's designed to help those B.C. retailers, it admits that not a dime of any money collected from tax evaders would go toward assisting the ailing retailers' businesses.

John Winter, president and chief executive officer of the government-friendly B.C. Chamber of Commerce, said he is perplexed by the Liberals' move.

"It seems particularly vindictive to me," said Mr. Winter. "People who go shopping have an expectation of privacy. I just think that for what they might possibly be getting in return through this measure the government is using up an awful lot of political capital. It really makes no sense."

The Retail Council of Canada has also generally been a big booster of the measures of Gordon Campbell's government. But Kevin Evans, vice-president of Western Canada for the council, expressed bewilderment over the move.

"To me it doesn't look like an investigation [into tax evasion] as much as it does a fishing expedition," said Mr. Evans.

"At first blush you can't help thinking this had to have been dreamed up by some bureaucrat sitting in a corner somewhere. It does nothing to build up confidence or any kind of goodwill with the government."

B.C. border communities have suggested they lose upward of $230-million a year in sales to Alberta. For the B.C. government, that would amount to about $16-million in lost sales-tax revenues.

Analysts believe the province would be doing well if it recovered 5 to 10 per cent of that foregone revenue through initiatives such as the one with which it is trying to get Costco to co-operate. That would mean the whole exercise might be worth between $1.1-million and $2.3-million to the province.

"Is it really worth it?" said Ms. MacIntyre. "I mean, this is the same government that is offering more than $881-million in tax credits and incentives to different industries and groups, going after the little guy for what may amount to a couple million bucks. Who can explain it?"

The usually talkative Revenue Minister could, except he's suddenly gone to ground.
Phix
Costco rules.

The bakery rules.

The free samples are amazing.

Costco is Godco.
Keitero-sama
They are building a CostCo now here in Raleigh....... all we have now are two Sam's Clubs and a BJ's. >_<
leif
um. this is the BC provincial gov. not the federal...lets be clear...this should not be used against the Federal Liberals.
PAULIE_D
^ I never mentioned anything about the Feds.
Phix
How much are Costco membership cards?
dukenukem
$35 USD for normal ones ..
veritech
costco is a fuckin steal. they give you the most bang for your buck. you mess with costco, you mess with the world!
goota
man i had this bag of dried mangos, and they were from costco, and it was like 2 lbs of it or something. it took me two weeks to finish the bag off ahahahaha. i fucking love costco.
clarkma5
DRIED MANGOS.

I had dried mangos in hawaii. They were awesome but I ate almost the whole bag and they didn't do particularly kind things to my intestinal tract.
PAULIE_D
Bottom line... it's easier to go after "the little guy."

i.e. the average consumer.
veritech
my mom bought a box a strawberries, which went bad. she returned it back to costco, where they gave her full price back, even though they were rotten, and we had eaten the nonrotten ones. wink.gif
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