A multi-party legislative committee is recommending that the B.C. government cancel a planned expansion of the Provincial Sales Tax to a range of professional services, a move welcomed by the Canadian Federation of Independent Business (CFIB).
The Select Standing Committee on Finance and Government Services made the recommendation as part of its consultations for the provincial government’s 2027 budget. The recommendation comes less than two months before the tax expansion is scheduled to take effect on October 1.
The CFIB says extending the seven per cent PST to professional services could add more than $500 million in annual costs for businesses and consumers across B.C.
“We’re hopeful that the government will adopt the committee’s recommendation and cancel the tax hike scheduled for October 1,” said Ryan Mitton, CFIB’s B.C. director of legislative affairs.
Services that are set to be subject to the expanded PST include accounting and bookkeeping, architectural, engineering and geoscience services, non-residential rental and strata management, commissions on non-residential real estate transactions, and security and private investigation services.
The CFIB says the change could have a particular impact on small businesses, many of which either purchase these professional services or provide them to other businesses.
According to a CFIB survey submitted as part of the Budget 2027 consultation, 80 per cent of businesses surveyed oppose the expansion, while 72 per cent said they are likely to pass the additional cost on to customers.
The organization argues that could result in higher costs for a wide range of businesses and consumers at a time when many are already facing increased operating expenses.
“Growing the economy will help bolster the budget and pay for the services we all rely on,” Mitton said.
The CFIB also pointed to what it describes as an “entrepreneurial drought” in B.C., saying more businesses have closed than opened for five consecutive quarters.
The organization is continuing to collect signatures for a petition calling on the provincial government to cancel the PST expansion. As of August 11, more than 3,500 small businesses had signed.
The committee’s recommendation does not itself cancel the planned tax change. The provincial government would need to adopt the recommendation and change the legislation or regulations governing the expansion.
For small businesses in communities such as Sayward, the issue could affect both the cost of professional services they rely on and the prices charged by businesses that provide those services.
The B.C. government is expected to consider the committee’s recommendations as it develops Budget 2027.
