B.C. Liberal leader Andrew Wilkinson speaks in the legislature, Feb. 26, 2020. (Hansard TV)

$5 billion fall tax bill too much for B.C. business, NDP told

PST, employer health tax, hotel tax may come due Sept. 30

B.C.’s budget deficit is currently pegged at a record $12.5 billion, as the NDP government faces the beginning of a wave of business closures due to the COVID-19.

That’s four times the size of the last big deficit in 2012, when the B.C. Liberal government had to buy its way out of a rejected harmonized sales tax deal with Ottawa. And current B.C. Liberal leader Andrew Wilkinson has repeatedly proposed bringing it up to $15 billion, by forgiving the first 90 days of deferred taxes that Finance Minister Carole James has set for repayment by the end of September.

Collected but not remitted sales and hotel taxes, along with the government’s new employer health tax on payrolls, will total about $5 billion by fall, Wilkinson told the B.C. legislature July 15. Businesses who have been “running on fumes” for four months aren’t going to be able to repay it, he said.

James kept the door open to extending the repayment deadline, but has not commented on granting the tax holiday that Wilkinson has argued for in a series of letters to Premier John Horgan. The repayment schedule will be reviewed “well before we get to Sept. 30,” James said in question period.

“I’m afraid that kind of answer will be cold comfort to the thousands of businesses that are facing huge tax-deferred bills coming due this September, for which the minister refuses to provide an answer,” replied Abbotsford West MLA Mike de Jong, who preceded James as finance minister. “Families are facing work uncertainty or outright unemployment.”

RELATED: B.C. moves to allow three years of budget deficits

RELATED: B.C.’s potential deficit $12.5 billion as spending soars

The Business Council of B.C. has not endorsed the idea of a tax holiday, but it is calling for an extension of the payment deadline through 2020 and a staged repayment plan that could extend to the end of 2021.

“With a very slow economic recovery and the enormous damage inflicted on many economic sectors by the virus and the measures taken to contain it, we believe there is a strong argument for extending the 2020 tax deferrals until the end of the year,” BCBC chief policy officer Jock Finlayson told Black Press Media July 16. “We are not recommending an extension beyond that point.”

With an uncertain future for the COVID-19 pandemic, which has plunged B.C. government revenues as spending has ramped up, accumulated debt is also a key factor.

“From an accounting perspective, the government is not ‘losing revenue’ with tax deferrals,” Finlayson said. “ Rather, it receives the money due with a delay. The only cost to the treasury is the interest paid on the extra short-term debt – which today is substantially less than one per cent. So there is very little impact on the size of the deficit.”


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

BC legislatureCoronavirus

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

The River Forecast Centre is issuing a Flood Watch for the Central Coast including Bella Coola River (file photo)
Flood watch issued for Bella Coola River

The River Forecast Centre is issuing a Flood Watch for the Bella Coola River

Two of the three grizzly cubs that were relocated to Smithers after their mother was killed (Caitlin Thompson photo)
Bella Coola residents urged to secure attractants after two sow grizzlies killed

One sow was a mother to three cubs of the year, which have been transported to Smithers

Environment Canada says up to 70mm is expected for Bella Coola (file photo)
Rainfall warning issued for Bella Coola

Up to 70mm is expected for inland coastal sections

Carey and Angela Price announced the birth of their third child on Monday, named Lincoln. (Photo submitted)
Canadiens’ Carey Price, wife Angela, announce birth of baby boy Lincoln

Prior to Monday’s announcement, Carey and Angela had two daughters: Liv, 4, and Millie, 1

Subsea fibre optics running from Prince Rupert to Haida Gwaii and and then south to Vancouver will improve high-speed internet connection options for Coastal Communities, CityWest said on Oct. 13. (Black Press Media)
Subsea fibre optics running from north of Prince Rupert to Haida Gwaii and and then south to Vancouver will improve high-speed internet connection options for Coastal communities, CityWest said on Oct. 13. (Black Press Media)
CityWest to refresh subsea fibre optics project

Fibre optics project to run cable from north of Prince Rupert to Haida Gwaii then south to Vancouver

Carolyn and Steve Touhey came across a pod of humpback whales while on their boat Sunday, Oct. 25. Photo supplied
VIDEO: Boaters encounter pod of humpbacks in Georgia Strait

Pod spotted between Comox and Texada Island

The Williams Lake Indian Band is stipulating no-go zones for mushroom picking in areas burned by last summer’s wildfires. 100 Mile Free Press photo
Who controls mushroom harvesting on Indigenous lands?

‘We don’t necessarily know where the mushrooms grow, how old the stands need to be, those types of things.’

Canadian and American flags fly near the Ambassador Bridge at the Canada/USA border crossing in Windsor, Ont. on Saturday, March 21, 2020. THE CANADIAN PRESS/Rob Gurdebeke
U.S. election results one factor that could impact immigration to Canada next year

The survey polled 1,523 Canadians between Oct. 23 and Oct. 25

Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

The voting station mimicked a real voting station in Nicole Choi’s classroom at Chilliwack middle school on Oct. 22, 2020, where students had to show their ID (student cards), be checked off a list, and mark a secret ballot behind a screen. (Jessica Peters/ Chilliwack Progress)
B.C. students choose NDP majority in mock election

More than 90,000 youth took part in school-based election process

Crew transport bus at the Trans Mountain pipeline project work site in Burnaby, March 2020. (Trans Mountain)
Check your workplace COVID-19 safety plans, Dr. Henry urges

Masks in public spaces, distance in lunchrooms for winter

B.C.’s Court of Appeal is in Vancouver. (File photo: Tom Zytaruk)
Judgment reserved in Surrey Six slayings appeals

Six men were killed in suite 1505 of the Balmoral Tower in Whalley on Oct. 19, 2007

Most Read