Newly-declassified records from 1989 reveal that then-Finance Minister Michael Wilson assured cabinet there was no taxpayer revolt over his plan to introduce the Goods and Services Tax (GST), a prediction that proved disastrously wrong. Blacklock's Reporter says the widespread backlash that followed helped reduce Wilson’s Progressive Conservative Party to just two seats in Parliament in the 1993 election.“The Minister of Finance reviewed the situation from his perspective,” stated confidential cabinet minutes from an October 26, 1989 meeting. “His assessment of the public environment vis-à-vis the GST proposal was as follows: There was no ‘revolt’ building against the GST. Instead, there was a growing sense of inevitability… with some grudging acceptance.”Wilson, who initially proposed a 9% GST, acknowledged that public awareness of the tax was high, but he underestimated the intensity of opposition. “There was a very strong public sense of ‘too much tax,’” Wilson admitted during later discussions, as public resistance mounted. By the end of 1989, facing fierce opposition, Wilson scaled the GST down to 7%, conceding that cabinet was “clearly not getting our message across.”Prime Minister Brian Mulroney, aware of the political risks, remarked in the same meeting that sales tax reform was “one of the most difficult initiatives the government could undertake.” He urged quick implementation to avoid losing momentum before the next election cycle.Despite the cabinet’s efforts to reframe the tax, Wilson recognized that small businesses were especially opposed, and provincial support was elusive. The GST remained deeply unpopular when it came into effect on January 1, 1991, at a 7 percent rate.Opposition to the GST was later credited with contributing to the Progressive Conservatives’ stunning defeat in the 1993 election, and the party eventually disbanded in 2003. Stephen Harper, a former organizer with the Reform Party that led anti-GST protests, reduced the rate to 5% in 2008.Wilson passed away in 2019 at the age of 81. The cabinet minutes were released yesterday under the Access to Information Act, offering a glimpse into the internal miscalculations that surrounded the introduction of one of Canada’s most controversial taxes.
