​​​​​In an effort to pay for increased social programs, the British Columbia government introduced the province's first sales tax of three percent on April 8, 1948.
The Social Security and Municipal Aid Tax Act, 1948, was contested in the Legislative Assembly and criticized for being too far-reaching, covering everything from automobiles to medicine. It passed into law and went into effect on July 1, 1948.
Other legislation passed at the same time, like the Hospital Insurance Act, 1948, was also unpopular. It set up a system of provincial hospital insurance paid for by premiums heavily weighted against single people. The plan ran into financial difficulties and in 1954 the premium system was eliminated. A universal insurance system was then introduced, funded in part by increasing the provincial sales tax another two percentage points.​
