Councillor wants planning ahead of payroll health tax

MSP replacement to cost district $27,300; Peake threatens tax hike to pay

SUMMERLAND — The potential impact of the recently announced Employer Health Tax on the municipality and school district concerns a Summerland councillor.

“This tax will impact our municipality and make it more difficult for us. It will mean a (property) tax hike,” Coun. Janet Peake said Monday.

The B.C. NDP government announced the proposed tax in its first budget released in February.

The announcement accompanied the proposed elimination of the Medical Services Plan premiums.

MSP premiums are levied on individual taxpayers—sometimes paid by employers—while the proposed EHT will be levied on a business’s payroll effective January 1, 2019.

“We should have a thorough discussion on this,” Peake said.

The EHT will result in an increase of $27,300 over the current MSP premiums currently paid by the district, according to director of finance David Svetlichny.

“It is likely that there will also be indirect cost increases with Employer Health Tax implications being passed on by contracted service providers,” Maple Ridge Mayor Nicole Read wrote in a letter to the B.C. Minister of Finance.

A copy of Read’s letter was sent to Summerland council.

Both Peake and Read also expressed concern about the impact on school districts, which have fewer ways than municipalities to cover increased costs.