MSP hike off as real estate lifts B.C. budget surplus

Property transfer tax expected to rake in nearly $1 billion more than planned for 2016

B.C. Finance Minister Mike de Jong.

The B.C. government has scrapped a planned medical premium increase next year now that the province’s surplus has ballooned to nearly $2 billion.

The red hot real estate market is a big factor behind the improved financial picture detailed in the first quarter budget update released Thursday.

Property Transfer Tax revenues for 2016 are now forecast at $2.1 billion – an increase of $965 million over the budget – with $165 million projected to come from the new 15 per cent tax on foreign buyers of Metro Vancouver homes.

The property transfer tax now far eclipses the $1.2 billion in forecast gambling revenue from the B.C. Lotteries Corp. and is just short of the $2.35 billion B.C. gets from all forestry, natural gas and other resource royalties.

The currently forecast surplus for the year of $1.94 billion is up from $264 million in the budget. And that’s after the province set aside $500 million for new housing priorities and other yet-to-be-announced measures.

“About half the value of the increased revenue from the Property Transfer Tax – $500 million – will be invested in new programs to benefit housing affordability and $400 million will be invested in the B.C. Prosperity Fund as a legacy for future generations,” Finance Minister Mike de Jong said.

The province is forecasting stronger 2.7 per cent economic growth for B.C. for 2016, up 0.3 per cent from budgeted.

The B.C. government now forecasts continued balanced budgets with surpluses of at least $900 million in each of the next two years.

De Jong said the higher revenues have allowed the government to cancel its planned four per cent increase to Medical Services Plan premiums set for Jan. 1 that would have increased costs for an adult by $36 a year.  Premiums will go down four per cent for those who are eligible for premium assistance.

Canadian Taxpayers Federation B.C. director Jordan Bateman said the MSP premium freeze is a positive step but no great cause for celebration.

“This comes after 15 years of straight increases, more than doubling it on their watch,” he said. “So we’re not planning a parade for these guys and we still want to see (MSP premiums) scrapped completely.”

Bateman said the B.C. government uses medical premiums, rather than some more direct form of taxation for health care, so it can claim low overall taxes compared to other jurisdictions.

“A family like mine is paying $150 a month in this tax, yet it’s not calculated as part of the overall tax burden by government.”

He said the move to scrap the MSP hike shows the government is feeling pressure on cost-of-living issues.

Bateman also cautioned that revenue from the Property Transfer Tax may have peaked if the foreign buyers tax has indeed cooled what was a frenzied market with record sales and fast price gains.

Just Posted

VIDEO: Tent city moves to Woodwynn Farm, arrests made

The group is asking the government to provide housing for 60 tent city members

Saanich passenger caught smoking weed in a car issued $230 fine

Saanich police did a field sobriety test on the driver and deemed it safe for him to drive

Cougar spotted Saturday morning in Saanich

Police found paw prints consistent with cougars in the area

B.C. Guide dogs is looking for volunteer puppy raisers

Labrador retrievers need to learn obedience and socialization before heading to work

Tommy Chong says cannabis legalization makes him proud to be a Canadian

Legendary marijuana advocate and comedian celebrates cultural milestone at Kelowna event

POLL: Do you support amalgamation for communities in the Capital Region?

Residents in Victoria and Saanich will be voting on Oct. 20 on… Continue reading

Team Canada gold medal winners for first time in world curling championship

Team Canada earned gold in Kelowna at the 2018 Winn Rentals World Mixed Curling Championship

Payette invites critics to ‘come and spend a few days’ with her

Governor General Julie Payette made her first official to B.C. back in March

More pot stores expected in B.C. in coming ‘weeks and months’: attorney general

Attorney General David Eby and Public Safety Minister Mike Farnworth visited the new BC Cannabis Store in the province’s Interior

Telus launches charitable foundation to help vulnerable youth

The Telus Friendly Future Foundation complements other social initiatives by the company, including Mobility for Good

Police say suspicious death of B.C. artist ruled a homicide

Patrick Zube Aylward’s body was found in a residence on a rural road outside of Seton Portage, west of Lillooet, B.C.

Temporary roads being built in areas affected by landslide in northern B.C.

Emergency Management BC news release says Disaster Financial Assistance is available to eligible residents of the Peace River Regional District who may have been affected by the landslides

B.C. tickets win big in Lotto Max draw

Jackpot carried over; B.C. tickets share Max Millions prizes

Most Read