B.C. keeps collecting law tax while underfunding legal aid
Consider the huge burr under the saddle of the B.C. bar: For decades, regardless of political stripe, provincial governments have been profiting from the clients of lawyers, using the legal profession as a cash cow, while ignoring the crisis in the courts and beggaring legal aid.
Victoria raked in $210.6 million last year from the PST on legal services, yet provided only about $75 million to legal aid (plus the federal transfer of about $16 million for criminal legal aid).
The province now spends on legal aid less than half the money milked from the profession as more and more individuals and families fall through gaping holes in the social safety net.
Lawyers bristle at the mere mention of the hoary levy that has been around so long people forget or don’t realize it’s there.
Hopefully, you, like me, have never had to pay it — only the unfortunates that require legal help are robbed.
The tax was introduced in 1992 by then-NDP finance minister Glen Clark, who implied it would be used to fund legal aid.
Quelle suprise that that was silver-tongued sophistry: The money was never “officially” designated to support legal aid.
The opposition Liberals throughout the 1990s loudly complained about such blatant fiscal sleight of hand, insisting the tax was supposed to be for legal services, damn it!
Geoff Plant, then the justice critic, thundered there really was something wrong with a government collecting all this money specifically intended to fund legal aid and then failing to do so — the socialist scoundrels!
Trouble was that when Plant became attorney general he continued the insidious practice.
“While I criticized the former government for failing to keep the political promise it made when it introduced the tax — to spend the money on legal aid services — the fact is that during five years as opposition justice critic, I never once said that if we became government we would dedicate the revenue stream,” Plant said. “Nor did I ever promise to maintain legal aid funding.” No, indeed.
He slashed legal aid funding by more than 40 per cent, precipitating the generation-long crisis that has hurt the most vulnerable: First Nations, women, children, the indigent and the needy.
Yet every attorney general for a quarter-century has defended this legerdemain.
In 2014, the last time the levy drew serious attention, thenjustice minister Suzanne Anton said: “When the provincial sales tax was applied to legal services in B.C. in 1992, the (NDP) government of the day did reference that the revenue from the tax would offset the escalating costs of legal aid. However, the tax was never designated to directly fund legal aid. The provincial sales tax collected on legal services is no different from any other good or taxable service. The revenue goes directly to government general revenues, which fund all ministries of government, including the Ministry of Justice.”
Legal aid is so underfunded that a single person working full time at the minimum wage is considered too rich to qualify. There is no help for most people with serious legal problems.
Yet judicial, prosecutorial and other public salaries have gone through the roof.
Still, the government spends only about what it did at the turn of the century on legal aid and the NDP’s David Eby has joined the list of attorneys general willing to accept the status quo.
Perhaps it was the dousing of the promise he held out, but a passionate debate has been ignited within the profession that until now has futilely wrung its hands and intermittently howled about the tax. At the Law Society of B.C.’s annual general meeting last month, lawyers were set to have a landmark discussion about the road to be taken.
Before the meeting was adjourned because of technical difficulties, Eby said the bar should do more charity work and drop its monopoly on legal services to allow paralegals to compete with family lawyers.
It sounded a lot like asking the profession to let B.C. off the hook for its responsibilities.
If the bar thought this onetime champion of civil rights was going to sympathize with their pleas, forget it. He’s standing with history and his cabinet cronies counting the cash.
Victoria lawyer Michael Mulligan has assiduously kept track, through freedom-of-information requests, over the years of how much money the government has made with this tax.
“The continued imposition of the special tax on legal services, which is not applied to any other professional services, is not only being diverted from its intended purpose, but it’s actually making access to justice even more challenging,” he said, fuming.
“Every time someone hires a lawyer to help them, they are required to pay the seven per cent special tax. This makes it all the more expensive for people who are struggling to hire a lawyer to help them.”
Mulligan is particularly angered that all family law services have been eliminated and single parents needing help to obtain child support or access to their children are ineligible.
“Even where someone is so poor that they remain eligible for legal aid, and where coverage for their problem still exists, the amount of money provided to hire a lawyer is now so low, that lawyers who are still willing to take on such work are paid so poorly that they are often unable to do the work that is required to assist someone properly,” he said.
The numbers that get thrown around are staggering — 50 per cent of relationships end with one in three women experiencing intimate partner violence and 15 per cent of family law cases collapse in high conflict.
Those who assault their spouses have lawyers funded by legal aid because it’s a criminal matter and are prioritized by the court over family matters.
The shortage of judges means family law cases are delayed and bumped, so women’s concerns are not heard.
Additionally, more than half of family cases are done with at least one party self-represented — usually the neediest.
For years, lawyers and others (like me) have been pointing out and decrying the injustices that result: Systemic inefficiencies only exacerbate the problems of legal-aid underfunding and the too many disoriented, self-represented litigants it creates.
Lawyers have staged futile service withdrawals and now are organizing to make concerted action more effective. Lots of luck with that.
The law society plans to resume its meeting and the debate Dec. 4.