A choice is before us. Metro Vancouver’s upcoming transportation referendum is a rare opportunity to significantly enhance transit services, boost local employment and tackle climate change. 

Metro Vancouver voters are being asked to support a 0.5 percentage point increase to the provincial sales tax (PST), which would raise $2.5 billion over ten years. Together with contributions from federal and provincial governments this means an overall $7.5 billion capital plan for transit and transportation.

New funding will not go to existing Translink operating costs, but rather is earmarked for new infrastructure and transit capacity – a commitment that will be independently audited.

The full ten-year transportation plan is designed to improve mobility for all of us in this region. It will mean road and bridge improvements, and substantial new transit infrastructure including 400 new buses, new rapid transit lines in Surrey and Vancouver, and new bike routes.

These transit enhancements are especially vital for low-wage and immigrant workers, who often have to commute long distances, and who frequently work night shifts when transit options are currently limited (the Mayors’ plan would see a 80% increase in night bus service). It’s also of special importance to youth and seniors, who rely more heavily on transit, and to seniors and people with disabilities who rely on HandyDART services (which would be boosted by 30%).

The status quo of increasingly congested roads, long delays, and overcrowding is not a viable option.  With Metro Vancouver’s population expected to grow by a million people, we desperately need more transit (for reasons related to both equity and climate), and we have to collectively pay for it one way or another.

That said, many are understandably worried about the impact of a sales tax increase on low-income people. As social justice researchers, we share those concerns. But whether or not the tax increase is fair depends on how the tax is structured and what we use the money for.

It is true that sales taxes in isolation are regressive, meaning that while upper-income households pay more in dollars, lower-income households pay more as a share of their income.

However, the PST does not apply to core necessities such as rent, groceries, and child care, so much of what lower-income households spend their money on is exempt from the tax. For example, households with income of $20,000 would see their costs go up by about $4 per month.

But it’s not enough to look at the revenue side alone – what we spend the additional revenue on also matters. For example, Scandinavian countries have much higher sales taxes than we do (Sweden’s is 25%), but their public expenditures on universal, high quality services greatly reduce inequality, making the overall tax system much more progressive than ours.

In this case, because the new investments will go mainly to transit improvements, which particularly benefit lower-income people, the transportation plan is progressive overall.

Because the plan will make transit faster and more convenient in every part of the region, it also means more people will be encouraged to switch from commuting by car to transit. Such shifts result in savings on gas, parking, and car maintenance. And if a family finds it can now do without a car, the savings amount to thousands of dollars a year.

Last but not least, any regressive impact of a sales tax increase could be easily fixed.  Given the political will (and enough pressure), the provincial government could increase the PST credit, boost the low-income carbon tax credit, or extend the discount student U-Pass to lower-income people.

The proposal before us is imperfect, but it would be a mistake to let the perfect defeat the good. The mayors have presented us with a bold transportation vision for our growing region. We should not let our frustrations with the provincial government or Translink stand in the way of this rare opportunity to improve our quality of life.

If you’re angry about the choice of a sales tax increase to fund the transit plan, we invite you to channel your energies into pushing for a fair tax system rather than voting No on this proposal. We need new transit infrastructure, but we also need fair tax reform – and we will continue to advocate for both.

About the authors

Seth Klein

Seth Klein is a CCPA-BC research associate and the former CCPA-BC Director. His research deals primarily with welfare policy, poverty, inequality and economic security. A social activist for over 30 years and a former teacher, Seth holds a BA in international relations, a BEd from the University of Toronto and an MA in political science from Simon Fraser University. Seth is an adjunct professor with Simon Fraser University’s Urban Studies program and the former BC director of the Canadian Centre for Policy Alternatives. His book A Good War: Mobilizing Canada for the Climate Emergency is now available. Seth is also a past co-chair of the BC Poverty Reduction Coalition, an advisory board member for the Columbia Institute’s Centre for Civic Governance, and an advisor and instructor for Next Up, a leadership program for young people committed to social and environmental justice. Follow Seth on Twitter

Marc Lee

Marc Lee is a Senior Economist with the Canadian Centre for Policy Alternatives. Marc joined the CCPA’s British Columbia office in 1998, and is one of Canada’s leading progressive commentators on economic and environmental policy issues. From 2009 to 2015, Marc led the CCPA’s Climate Justice Project (CJP), which published a wide range of research on fair and effective approaches to climate action through integrating principles of social justice. Marc continues to write about climate and energy policy, strategies for affordable housing, federal and provincial budgets and macroeconomics. Marc has an MA in Economics from Simon Fraser University and a BA in Economics from the University of Western Ontario. Marc is a past chair of the Progressive Economics Forum, a national network of heterodox economists. He also served as a Visiting Professor at Simon Fraser University’s School of Public Policy in 2024 to 2025.

Iglika Ivanova

Iglika Ivanova is a Senior Economist and the Public Interest Researcher at the CCPA’s BC Office. She researches and writes on key social and economic challenges facing BC and Canada, including poverty, economic insecurity and labour market shifts towards more precarious work. Iglika is Co-Director of the Understanding Precarity in BC Project (UP-BC). Iglika also investigates issues of government finance, tax policy and privatization and how they relate to the accessibility and quality of public services. She is particularly interested in the potential for public policy to build a more just, inclusive and sustainable economy. Follow Iglika on Twitter