Finance Minister Mike de Jong presents the 2016-17 budget in the B.C. legislature Tuesday.

BC BUDGET HIGHLIGHTS: Real estate, MSP, disability benefits

Luxury tax on new homes over $2 million, children exempted from rising medical fees, prosperity fund without LNG revenues

Property transfer tax trimmed

Newly built homes worth up to $750,000 are exempt from B.C.’s property transfer tax under changes in the provincial budget that take effect immediately.

Finance Minister Mike de Jong expects to make up most of the lost revenue by increasing the tax rate from two to three per cent on the value of homes in excess of $2 million.

For resold homes, property purchase tax continues to apply at one per cent on the first $200,000 of value and two per cent on value between $200,000 and $2 million.

The tax has produced a windfall for the province and pushed home purchase costs even higher in the hot market for homes in some urban areas. The government expects to collect about $200 million more than it budgeted for the current year, due to soaring prices and a high number of sales.

De Jong said the break is aimed at new construction to stimulate new housing construction, adding to supply in response to demand that is driving prices up.

The exemption is only available to Canadian citizens and permanent residents, and the government is resuming tracking nationality of buyers, a practice stopped in 1998.

The upper limit to qualify for the homeowner grant is also increased from $1.1 million to $1.2 million for the 2016 property tax year.

Children exempted from MSP premiums

Medical Services Plan premiums are being charged only for adults starting in 2017, and the qualifying income for reduced premiums is going up from $30,000 to $42,000 for single people.

The new system creates a break for single parents, who will pay a single adult rate of $78 a month  instead of the current rate of $150 charged for a family of three. A single senior or single parent with one child and an income of $45,000 may also be eligible for reduced premiums.

The changes will reduce rates for an additional 335,000 people, and 45,000 more people will be exempted from paying as long as they are registered and qualify. But rates overall continue to rise. With a four per cent increase in personal rate this year and growing population, the government expects to collect more MSP each year of its three-year budget plan than with the current system.

B.C. is the only province that charges premiums for health services, and the NDP opposition has called for them to be eliminated as a regressive tax. De Jong argues that MSP covers only 14 per cent of a growing health care budget, and eliminating it would amount to hiding the cost in the general tax system.

Prosperity fund gets seed money

With liquefied natural gas export projects delayed, Premier Christy Clark’s promise of a “B.C. Prosperity Fund” has been launched with $100 million from the current budget surplus.

The fund was touted in the 2013 election as a way to pay off debt starting in 2017, and reduce or even eliminate B.C.’s sales tax with revenues from five LNG plants. But with a glut of oil and gas internationally, no major project is expected to be under construction by the 2017 election.

Including the fund in his 2016-17 budget, Finance Minister Mike de Jong said most people would agree with “the notion that we would take a modest amount of money out of our chequing account and put it in our savings account.”

The finance ministry expects a surplus of $377 million at the end of the current fiscal year and $264 million in the fiscal year that begins April 1.

The prosperity fund is restricted to a minimum 50 per cent to pay down debt, 25 per cent saved to earn interest and the rest available to spend on health care, transportation and other government functions.

Disability benefits up $77 for some

Income assistance payments for people with disabilities are to increase up to $77 per month effective Sept. 1, but transit passes will no longer be covered.

Bus passes have only been provided for some regions of the province, an unfair situation for those who can’t take advantage of transit, said Finance Minister Mike de Jong. The increase will be across the board and recipients can choose for themselves if they use it for transit or other needs.

The B.C. Liberal government has resisted calls for an increase in the general social assistance rate, but has ended the clawback of child support payments to single parents.

Since 2012 the government has moved to encourage income assistance recipients to work, allowing earnings up to $200 a month without losing benefits for those who file tax returns.

People on disability assistance can retain up to $800 a month, up from $500 in 2012.

 

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

Just Posted

Poppy donation boxes have been delivered to restaurants, cafes, stores and places of businesses in Prince Rupert by the Royal Canadian Legion Branch 127 for the 2020 National Poppy Campaign. (Photo: K-J Millar/The Northern View)
National poppy campaign restricted by COVID-19

Prince Rupert Royal Canadian legion expects less donations to offer vital assistance to local vets

Elena Tran 9, grade five student at Conrad Elementary School learns about Truth and Reconciliation on Oct. 21 with the story of Chanie Wenjack who died at the side of rail lines while fleeing a residential school in 1967. (Photo: K-J Millar/The Northern View)
Conrad Elementary students learn of ‘reconciliACTION’ during Secret Path Week

Secret Path Week from Oct. 17 to 22 commemorates the passing of Chani Wenjack and Gord Downie

More than $10,000 in donations and toys was presented to the Salvation Army by the Prince Rupert Harley riders on Oct. 20, from the 39th annual Toy Ride held on Sept 26. (Photo: K-J Millar/The Northern View)
Harley Riders rode to victory with $10,000 donation to Salvation Army

The 39th annual Prince Rupert Harley Riders gifted more than 280 toys from the annual Toy Ride

The Prince Rupert Port Authority Land Use Plan will guide the growth within lands and waters under its jurisdiction and facilitate Canada’s trade with the world for the next 20 years. (Photo: Supplied by Port of Prince Rupert)
Land Use Plan finalized by Port Authority

PRPA Land Use Plan plan guides the growth and trade for next 20 years within its lands and waters

Such sweetness with all this candy. Dylan Kennedy 7, with his mom Kerri Kennedy volunteer at the Halloween Fest Committee event to bag candy for students in SD 52 on Oct. 19. (Photo: K-J Millar/The Northern View)
How sweet it is

Bags of candy were assembled by more than 25 Halloween Fest Volunteers for distribution to S.D. 52

B.C. provincial health officer Dr. Bonnie Henry gives a daily briefing on COVID-19 cases at an almost empty B.C. Legislature press theatre in Victoria, B.C., on March 25, 2020. (Don Craig/B.C. government)
B.C. sees 223 new COVID-19 cases, now 2,009 active

Two new care home outbreaks in Surrey, Burnaby

BC Liberals Leader Andrew Wilkinson, BC Greens Sonia Furstenau, BC NDP John Horgan (The Canadian Press photos)
British Columbians vote in snap election called during COVID-19 pandemic

At dissolution, the NDP and Liberals were tied with 41 seats in the legislature, while the Greens held two seats

100 Mile Conservation officer Joel Kline gingerly holds an injured but very much alive bald eagle after extracting him from a motorist’s minivan. (Photo submitted)
B.C. driver thought he retrieved a dead bald eagle – until it came to life in his backseat

The driver believed the bird to be dead and not unconscious as it turned out to be

Chastity Davis-Alphonse took the time to vote on Oct. 21. B.C’s general Election Day is Saturday, Oct. 24. (Chastity Davis-Alphonse Facebook photo)
B.C. reconciliation advocate encourages Indigenous women to vote in provincial election

Through the power of voice and education Chastity Davis-Alphonse is hopeful for change

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

White Rock RCMP Staff Sgt. Kale Pauls has released a report on mental health and policing in the city. (File photos)
White Rock’s top cop wants to bill local health authority for lengthy mental-health calls

‘Suggestion’ included in nine-page review calling for ‘robust’ support for healthcare-led response

A Le Chateau retail store is shown in Montreal on Wednesday July 13, 2016. Le Chateau Inc. says it is seeking court protection from creditors under the Companies’ Creditors Arrangement Act to allow it to liquidate its assets and wind down its operations.THE CANADIAN PRESS/Ryan Remiorz
Clothing retailer Le Chateau plans to close its doors, files for CCAA protection

Le Chateau said it intends to remain fully operational as it liquidates its 123 stores

RCMP stock photo (Black Press)
Charges laid against Prince George man, 39, in drug trafficking probe

Tyler Aaron Gelowitz is scheduled to appear in court Nov. 18

Most Read