Page 1 of 1 - Mayors` Council

Congestion Improvement Tax to be Applied Based on Where
Vehicles are Registered to Level Playing Field Among Auto Dealerships
FOR IMMEDIATE RELEASE
March 20, 2015
Vancouver, BC – Yesterday, Minister Todd Stone responded agreeably to Mayors’ Council Chair, Mayor
Gregor Robertson’s proposal that if the plebiscite passes, the Metro Vancouver Congestion Improvement
Tax (MVCIT) will be applied to newly purchased vehicles based on the vehicle’s place of registration.
Mayor Robertson’s proposal was on behalf of the Mayors’ Council on Regional Transportation,
responding to concerns from the region’s new car dealerships and the public that the MVCIT might not
provide a level playing field with dealers outside the region. With today’s agreement between the
Provincial Government and the Mayors’ Council, vehicles will be taxed based on its place of registration
regardless of the location of the purchase, should the plebiscite pass.
“We are pleased that Minister Stone recognizes that the mayors are working towards the most fair and
equitable tax for Metro Vancouver consumers,” said Township of Langley Mayor Jack Froese. “Following
this model for new vehicles will allow auto dealerships to remain competitive with dealers outside of the
region, while ensuring consumers that the tax is fairly applied.”
Currently, the Insurance Corporate of British Columbia (ICBC) already requires that vehicles be registered
based on the place of residence, a factor in the determination of rates. To provide a seamless transition
with the new tax, the approach would be for ICBC AutoPlan dealers to collect the MVCIT increment at the
time of vehicle registration. According to Mayor Robertson’s letter, Seattle and Los Angeles follow the
same model where additional tax is placed based on where the vehicle was registered, “demonstrating
that differential sales taxes can be successfully implemented and managed to the benefit of residents and
the economy.”
All across Metro Vancouver, voters have been receiving their ballot to cast their vote in favour or against
the 0.5 per cent MVCIT. If a “yes” vote prevails, the MVCIT will be added on to the existing Provincial
Sales Tax (PST), with current PST exemptions applicable.
Voting “yes” to the MVCIT is crucial to improving our transportation and transit system with multiple
investments that benefit commuters all over the region, whether they drive, take transit, bike or walk.
Mayors strongly urge residents to vote “yes” for this most affordable option for residents and businesses.
To read more about the Mayors’ Plan, visit www.mayorscouncil.ca.
Voters must mail their ballots to Elections BC before 8 p.m. on Friday, May 29, 2015. To learn more about
the voting process, visit www.elections.bc.ca/plebiscite.
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March 3, 2015 Honourable Todd Stone Minister of Transportation and Infrastructure P.O. Box 9055 Stn Prov Govt Victoria, BC V8W 9E2 Sent via e‐mail Dear Minister Stone, I am writing you to request that the design of the proposed Metro Vancouver Congestion Improvement Tax (MVCIT) ensures that vehicles purchased outside the Metro Vancouver region are taxed based on the vehicle’s place of registration. Ideally, the province’s decision on this issue could be shared well in advance of voting in the Plebiscite, so that businesses and the public are confident the tax will be implemented in as fair and efficient a manner as possible. We bring this recommendation to you based on concerns we have heard from representatives of the region’s car dealers, and the public, that the new tax provides a level playing field with dealers outside the region. It has been suggested that collection measures require that the MVCIT on vehicle sales outside the region be applied based on where the vehicle will be registered. ICBC already requires that vehicles be registered based on the place of residence which is a factor in the determination of rates. We were happy to hear you publicly acknowledge awareness of this issue and we ask that you bring resolution to this as soon as possible. There is precedent for this approach from other jurisdictions with differential sales tax rates, such as the Seattle and Los Angeles regions, that require taxes be based on place of residence. For Metro Vancouver, one approach would be for ICBC AutoPlan dealers to collect the MVCIT increment at the time of vehicle registration. The cases of Seattle and Los Angeles demonstrate that differential sales taxes can be successfully implemented and managed to the benefit of residents and the economy. The specific requirements around motor vehicle sales contribute to both an efficient application of the tax and most importantly ensure public confidence that the tax is being fairly applied. Finally, I want thank you for your letter of February 1, 2015 that brought important clarity on the design of the MVCIT. The Mayors’ Council supports the province enabling this tax to be administered as an addition to the existing provincial sales tax (PST) within the region. As you know already, the Mayors’ Council is not recommending any additional exemptions to the PST. The next few months are critical to the future of our region. A positive outcome is vital for delivering more buses, better roads, and more transit options. We welcome your recognition of the importance of a ‘Yes’ vote. Yours truly, Mayor Gregor Robertson Chair, Mayors’ Council on Regional Transportation