Viking Air manufactures aircraft on Vancouver Island and in Alberta. (Viking Air photo)

Carole James avoids questions on B.C.’s payroll tax (with video)

Green MLA Adam Olsen cites huge tax increase for local business

B.C.’s new employer health tax to replace Medical Services Plan premiums was quietly made official Tuesday, with legislation presented to impose it on payrolls of $500,000 or more as of Jan. 1, 2019.

Finance Minister Carole James presented two controversial tax bills at the same time, with most of the attention going to the government’s “speculation and empty home tax” on urban areas getting most of the attention.

The employer health tax has much wider effect, triggering property tax increases across the province as municipalities have to pay the payroll tax and the half-portion of their employees’ MSP fees on top of each other for 2019. MSP is due to be phased out entirely in 2020.

RELATED: Fraser Valley greenhouse growers hit hard by tax

RELATED: Survey finds 30% of businesses expect to cut staff

James emphasized the positive results, effectively a personal income tax cut for individuals who pay their own MSP premiums. Non-profits are essentially exempted, health authorities, school districts and post-secondary institutions have been promised budget increases to cover the tax. But larger businesses are in the same boat as municipalities, paying MSP and then shouldering a tax burden larger than the total.

“Employers with B.C. payrolls between $500,000 and $1.5 million will have their rate phased in,” James told the legislature. “Employers with B.C. payrolls greater than $1.5 million will pay 1.95 per cent of their total B.C. remuneration.”

B.C. Green Party MLA Adam Olsen raised the issue Monday, describing how that lands on big employers in his constituency and citing the risk of chasing away major private sector manufacturers. He noted that Viking Air manufactures its famous Twin Otter and other aircraft in Alberta as well as the Saanich Peninsula where it is headquartered.

“If they left for Calgary it would be devastating,” Olsen said.

Another employer that has shared its concerns with Olsen is Schneider Electric, which employs 280 people in Central Saanich.

“They have a payroll of $20 million,” Olsen told the legislature. “In 2017 they paid $42,000 for their employees’ Medical Services Plan premiums, and in 2020 they will pay $390,000 through the employers’ health tax. Schneider’s local management will have to defend to head office why they should stay in the Saanich Peninsula or even in British Columbia.”

Olsen, whose party is keeping the NDP minority government in power, asked James what steps she was taking to make sure the payroll tax isn’t “the final straw” for B.C. employers.

James avoided the question with often-used talking points about B.C. having the lowest unemployment rate in the country and using the payroll tax revenue to invest in health care.

The exchange between Olsen and James can be viewed here.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Redesign Rupert holds four-day workshop to reimagine the city

A condensed downtown core and waterfront access among the topics discussed

A new vessel from the Gitga’at First Nation will be sailing into Prince Rupert’s harbour

The transporter vessel will bring back materials, food and medicine for the Hartley Bay community

Prince Rupert Library recognizes National Indigenous History Month

Friends of the Library Book Club puts the focus on Indigenous authors and reconciliation

Smooth sailing expected on 14 major roads in Prince Rupert by end of summer

Construction underway with city’s $2.4 million paving budget

City of Prince Rupert seeking public input on Community Enhancement Grants

Survey now available to the public focusing on project priorities

Global Sports Bra Squad Day in Rupert

The event encourages athletes to run in whatever makes them comfortable regardless of shape or size

$900M settlement reached in class action on sexual misconduct in Canadian military

After facing criticism, the government moved to begin settlement proceedings in early 2018

Tax take stays ahead of increased B.C. government spending

Tax revenue $2.1 billion higher than budget in 2018-19

Two toddler siblings found drowned on First Nation in Alberta

The siblings were found drowned on their family’s property, according to RCMP

Chiefs honour Indigenous leader wrongfully hanged in B.C. 154 years ago today

Chief Joe Alphonse says they want his remains returned to his homeland in B.C.’s Cariboo region

Rare white ravens spotted again on Vancouver Island

Nature photographer Mike Yip said mysterious birds back in Coombs area

B.C. government seeks advice on reviving Interior forest industry

Public website opens as meetings start with community leaders

Psychics, drones being used to search for missing Chilliwack woman with dementia

Drones, psychics, dogs and more have been employed to help find Grace Baranyk, 86

B.C. mom to go to Europe court in hopes of getting alleged abducted daughter back

Tasha Brown alleges her estranged wife abducted their daughter Kaydance Etchells in 2016

Most Read