The biggest-ticket promise of B.C.’s surprise 2020 election is a tax cut. Andrew Wilkinson’s proposed elimination of B.C.’s seven-per-cent sales tax for a year would cost, by the party’s own estimates, $6.88 billion, while bringing it back at three per cent would forgo another $3.9 billion.
By contrast, NDP leader John Horgan’s vow to send out another round of $1,000 pandemic relief payments to most families in the province is budgeted to cost $1.45 billion, added to a pandemic-driven provincial deficit headed for a record $13 billion without additional measures promised in the Oct. 24 election.
Wilkinson says the removal of sales tax will leave $1,700 more in the bank for an average family of four, as well as help small businesses weather the long winter of COVID-19. While Horgan points to the PST savings one would receive when buying a yacht, Wilkinson notes that lower-income people pay proportionately more sales tax because their income goes mostly to day-to-day expenses.
Another divisive tax issue in the election is the NDP’s speculation and vacancy tax in areas with low rental vacancy rates. It caused an uproar in vacation destinations like the Okanagan, and a hasty retreat from the Gulf Islands and other rural areas where people have summer homes.
Horgan says the tax has caused 11,000 condos and other homes to be rented out at least six months of the year, and expects to raise $80 million from property owners who pay it. Wilkinson says the NDP tax doesn’t target speculators, and a B.C. Liberal government will impose a new “condo flipping capital gains tax” on resale of pre-build purchase contracts, a speculative market that has driven up costs in Metro Vancouver.
B.C. Green Party leader Sonia Furstenau went into the only televised election debate Oct. 13 without a full platform release, with the snap election called one week into her term as leader. Her first tax promise is to impose carbon tax increases on fossil fuels that were frozen under the former B.C. Liberal government and then postponed by former NDP finance minister Carole James as part of the government’s COVID-19 relief plan.
James also postponed payments from business on its new employer health tax, imposed on payrolls of larger companies to make up for the elimination of Medical Services Plan premiums paid by individuals and some employers on their behalf.
Horgan has accused Wilkinson of opposing the employer health tax, but the B.C. Liberal budget contains only a promise to appoint an “independent fair tax commission” to review all provincial taxes and recommend adjustments.
B.C. Liberal tax highlights:
• Eliminate the small business income tax, currently assessed at two per cent
• Introduce a seniors’ home care tax credit up to $7,000 a year for housekeeping, home repairs and supportive care
B.C. NDP tax highlights:
• a 15 per cent tax credit for businesses on eligible new payroll as part of the pandemic recovery plan
• a temporary 100 per cent PST rebate on selected machinery and equipment, not yet specified
B.C. Greens tax highlights
• End oil and gas tax incentives such as the deep-well drilling incentive that has been applied to B.C.’s fast-growing shale gas industry in the northeast.
• Immediately reinstate the scheduled carbon tax increase and return to increases of $10 per year