Letter writer argues ICBC policy of using book value to determine provincial sales tax is flawed. (Lachlan Labere-Salmon Arm Observer)

Letter writer argues ICBC policy of using book value to determine provincial sales tax is flawed. (Lachlan Labere-Salmon Arm Observer)

Letter: ICBC relying on flawed policy for private sales of used vehicles

‘It disadvantages lower-income individuals and families’

The true value of everything from oranges and TV’s to vehicles is based on the amount and terms that two consenting parties agree upon. This commonly understood practice is core to a functioning society and is simply the most accurate way to determine “value.”

In contrast, ICBC’s policy for determining the amount of sales taxes owing on used vehicles ignores this precedent, presents a conflict of interest, and raises concerns about ICBC’s ethics and power over a free market. Obviously, taxes must be paid on used vehicles but this system is deeply flawed and will have several unintended consequences which are costly, dangerous and financially reckless (ie. an increase in uninsured vehicles on the road, vehicles not being properly transferred into B.C., an increase in unsold/abandoned used vehicles, insurance fraud, etc.).

Read more: ‘It’s ludicrous’: Salmon Arm man resists new rules for private vehicle sales in B.C.

Read more: B.C. budget’s tax increases affect used vehicle sales, tobacco

Why is the system flawed?

The price books used by ICBC determine broad value estimates based on a combination of average historical sales provincially and federally, not the value ​ agreed upon between two parties in a specific market with unique risk factors.

Blue/black book figures are eschewed during periods of extreme supply/demand issues and inflationary environments such as during and after a pandemic or major environmental event (ie. B.C. flooding), and are slow moving by design. This means ICBC cannot determine the correct tax amount owing with enough local market sensitivity to be fair or consistent.

It is an attempt to control the free market. Consumers can and should properly assess their own risk to set pricing fairly, the taxes owing must respect this.

ICBC is acting as the Judge, Jury and Executioner in a way that creates a clear conflict of interest and erodes public trust in ICBC and Provincial ethics

It disadvantages lower-income individuals and families; this is a tone-deaf look for ICBC or the province.

Please allow the free market to be free and create a new system, with a little thought there are more ethical and fair structures available to ensure taxes are being collected properly.

Dan O’Reilly

Editor’s note: Regarding “policy,” ICBC administers changes set by the B.C. government.

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