Tax revenue increase spurs $1.5B surplus in B.C.

VICTORIA The British Columbia government ended its fiscal year with an operating surplus of $1.5 billion as the province collected more revenue from taxation and less money from a softening real estate market.

The 2018-19 public accounts released Thursday by Finance Minister Carole James show that the surplus was some $1.3-billion higher than anticipated, driven by $2.9 billion in increased revenue primarily from personal and corporate income taxes.

James said she was not concerned about a $315-million reduction in property transfer tax revenue. She said the previous Liberal government relied on an out-of-control real estate market to grow resources while her NDP government has a long-term economic plan.

“In fact, my bigger worry that I certainly had coming in as finance minister, is the worry of running an economy based on a speculative real estate market and skyrocketing housing prices,” she said.

James said the increased revenue reflected economic growth, household income growth and higher income tax assessments, not just government intervention. But the province also raked in millions from new taxes, including the employer health tax that brought in $415 million.

The public accounts also revealed that the province has eliminated its operating debt for the first time in 40 years and that the taxpayer-supported debt-to-gross domestic product ratio is 14.5 per cent, the lowest it has been in a decade.

B.C.’S economy grew by an estimated 2.4 per cent in the 2018 calendar year, the third-highest rate in the country, led by goods-producing industries, the public accounts showed. B.C. had the lowest unemployment rate in Canada at 4.7 per cent in 2018, down from 5.1 per cent the year before. Wage and salary growth also led the country at 5.9 per cent in 2018.

Shirley Bond, finance co-critic for the Opposition Liberals, said the government’s numerous new or increased taxes are having a devastating effect on British Columbians while their government refuses to lay out an economic or jobs plan.

“The NDP government’s primary source of revenue continues to be the pockets of taxpayers,” she said in a statement.