FLIPPING TAX, AND CASH FOR FAMILIES
B.C. NDP’S 2024 BUDGET ANTICIPATES RECORD $7.9 BILLION ANNUAL DEFICIT
RECKLESSLY, IT DRIVES INFLATIONARY PRESSURES, WHICH IMPACTS GROCERIES, IT IMPACTS HOUSING, IT IMPACTS EVERYTHING THAT IS ALREADY AFFECTING BRITISH COLUMBIANS.
— B.C. UNITED LEADER KEVIN FALCON
The B.C. NDP government’s election-year budget will run a record $7.9 billion deficit, almost double last year’s, fuelled by $6.2 billion more in spending to pay for a new BC Hydro rebate, more money for families and a program to fund in vitro fertilization for people trying to have a baby.
Premier David Eby’s long-promised flipping tax will take effect next year, aimed at discouraging speculators from buying and selling a property inside of two years.
Finance Minister Katrine Conroy defended the big spending budget, saying it would be “reckless ... to make cuts to people in this province. We cannot afford to have a deficit of services.”
Asked if one-time rebates through the BC Hydro credit and the boosted family benefit are goodies aimed at securing votes before the Oct. 19 election, Conroy said: “I think if I just did that because it was an election there would be a lot more in the budget.”
A budget that bleeds red ink at record levels is “the worst example of reckless spending that I have ever seen in a government budget, full stop,” B.C. United leader Kevin Falcon told reporters.
Falcon, once a finance minister in the previous B.C. Liberal government, said when the government spends so “recklessly, it drives inflationary pressures, which impacts groceries, it impacts housing, it impacts everything that is already affecting British Columbians.”
B.C. Conservative Leader John Rustad accused the B.C. NDP of “bankrupting the people of the future.”
The government delivered a “status quo” budget, B.C. Green Leader Sonia Furstenau said, that fails to invest in reliable public transit, the public education sector and “essentially ignores climate change.”
Here are seven ways the budget could affect British Columbians:
CASH BACK FOR FAMILIES
The B.C. family benefit will be boosted by 25 per cent for one year. The income threshold will be raised so that 66,000 more families will receive the benefit, which kicks in July 1. A family of four will receive up to $3,563 this year, up from the previous rate of up to $2,850 a year. A single parent with two children will receive up to $2,688 a year, up from $2,250. The benefit reduces on a sliding scale the higher a family’s household income, maxing out at $162,000. A total of 340,000 families are expected to receive the benefit which will cost the government $248 million this year.
FLIPPING TAX
Anyone who flips a home within two years of buying it will be hit with a new flipping tax that will apply to income from the sale of the property. Starting in 2025, those who sell within a year of the purchase will be hit with a 20 per cent tax. The tax rate gradually drops after a year, hitting zero at the two-year mark. There will be exemptions for circumstances such as divorce, death, illness and relocation for work.
EXPANDED HOMEBUYERS PROGRAM
The first-time homebuyers program will be expanded, raising the threshold of homes that would be exempt from the property transfer tax to a value of $835,000, up from $500,000. The first $500,000 will be exempt from the property transfer tax and then the purchase is taxed on a sliding scale up to $835,000.
B.C. United’s housing platform, released by Falcon earlier this month, included a promise to raise the property transfer tax exemption for homes valued up to $1 million.
The government did not raise the income threshold to qualify for rental subsidies such as the rental assistance program and the SAFER program for lower-income seniors. However, Conroy said such a move is being considered. Furstenau, who had called for a higher income threshold for rental subsidies and vacancy controls that limit how much landlords can hike the rent between tenants, said the budget offers “nothing new for renters.”
BC HYDRO CREDIT
The “big shiny object,” referred to in a memo inadvertently dropped by Energy Minister Josie Osborne in November, is in the budget in the form of a one-time B.C. electricity affordability credit applied to people’s BC Hydro bills. The credit will be applied to monthly bills starting in April with customers expected to save an average of $100 over the year.
PUBLICLY FUNDED IVF
For those turning to fertility treatments to have a child, B.C. will fund one round of in vitro fertilization, a program that will cost taxpayers $34 million a year. B.C. is one of the few provinces that wasn’t funding the first round of IVF, which is covered in Manitoba, Ontario and Quebec, for example.
The program garnered support from all three opposition parties but Falcon said it should start immediately instead of by April 1, 2025.
EDUCATION
The budget earmarks $306 million in new funding this year to add staff in public school classrooms in response to union concerns that teachers are overworked and there’s not enough staff to replace them when they’re sick.
However, B.C. Teachers’ Federation president Clint Johnston said that funding will only accommodate the growth in student enrolment and maintain a “status quo” that has serious gaps.
The government will spend $1.1 billion this year to build, renovate and seismically upgrade schools. However, the capital plan includes only one new school, Cedar Hill middle school in Victoria, at a cost of $54 million.
Asked why there’s no funding set aside for a new school in Olympic Village, which parents have spent years calling for, Conroy said: “They’ll be happy to see an announcement in the coming weeks.”
The Surrey school district, where overcrowded schools have forced hundreds of students to learn in portables, libraries and gymnasiums, has called for massive spending on new schools to accommodate the growing student population.
TAX RELIEF FOR BUSINESSES
The employer health tax threshold has been raised to $1 million from $500,000, something business groups have been asking for to lessen their burden. The government says this means 90 per cent of businesses will be exempt from the tax, which will save them a combined $100 million a year.
The tax was introduced in 2019 for businesses to replace medical services premiums for British Columbians.
HEALTH CARE
The government will spend $2 billion more on health care this year, including $90 million for cancer care. Capital spending of nearly $4.4 billion this year will pay for the construction of long-term care facilities, the new Surrey hospital, the expansion of Richmond Hospital, Burnaby Hospital and Royal Columbian Hospital and new cancer care facilities in Surrey and Burnaby.