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How British Columbia’s Tax on Legal Services Impairs Access to Justice

Legal services provided in BC are, unlike any other professional services, subject to provincial sales tax (PST). Accordingly, consumers in BC have a more difficult time obtaining legal help. They can hire an accountant, architect, veterinarian or any other professional. For some bizarre reason, justice fell to the bottom of the list of governmental priorities, as only legal fees are effectively increased by 7% due to this special tax. History shows that once a tax is in place, it tends to be permanent. Governments across Canada provide more meaningful legal aid mechanisms than in BC without a special tax on its consumers. Incredibly, in BC, its legal services tax revenue stream didn’t even make its way to pay for legal aid.

When introduced in 1992, the NDP government attempted to justify its new tax to support legal aid. However, since being first imposed, it has not only been diverted from this purpose but is harming it.

By imposing a special tax on legal fees, the BC government limits accessibility to legal assistance for the consumer often already faced with financial burdens due to the wrong committed against them.

It is well documented that indirect taxes put the more socially vulnerable citizens at a disadvantage and restrict their monetary means even further. Although richer households pay more in indirect taxes than poorer ones, they pay less as a proportion of their income. This means that an indirect tax like PST on legal services increases inequality.

Some of the core values of the Canadian justice system are fairness and equality. The BC government’s PST, in its current form, is not compatible with those principles.

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