Mayors and councillors are gathering in Whistler in September for their annual convention with B.C. cabinet ministers, just before they seek re-election in October. (Black Press files)

Payroll, speculation tax top municipal agenda for B.C.

Property tax hikes loom as local politicians seek re-election

The financial squeeze caused by doubling Medical Services Plan payroll costs next year is the top priority for local government leaders as they prepare for their annual meetings with B.C. cabinet ministers.

Imposition of the NDP government’s “employer health tax” for 2019, while municipalities and other employers are still carrying employee MSP premiums at a reduced rate for that year, are pushing up property taxes.

The Union of B.C. Municipalities convention in September will lead off with a resolution from Lower Mainland mayors and councillors, calling for the province to make the transition from MSP premiums to a payroll tax “cost neutral” for municipalities.

The resolution notes that municipalities with payrolls of more than $1.5 million will pay the highest rate of payroll tax, 1.95 per cent, effectively doubling their payroll costs for next year. It calls for “selected tax breaks” given to private sector organizations to be extended to cities and towns.

B.C. Finance Minister Carole James retreated on the payroll tax in July, announcing that school districts, health authorities and universities will still pay the tax, but their budgets from the province will be increased to cover the bump in costs until MSP premiums are phased out entirely in 2020.

RELATED: Non-profits, schools get break on health tax

But municipalities don’t get the break because they can raise revenues from their property tax break. Local politicians are gathering in Whistler for the UBCM convention Sept. 10-14, as most campaign for re-election to four-year terms in province-wide elections on Oct. 20.

Payrolls up to $500,000 are exempt from the health tax, and as part of her July remake, James also tripled the exemption for non-profit organizations to $1.5 million, letting almost all charitable organizations escape the tax.

For the NDP government, the health tax and a “speculation tax” on property value of second homes have been an ongoing battle since James introduced her first budget in February.

A resolution from Oak Bay calls for the province to let municipalities administer extra property taxes, and spend the money on “non-market housing” to help lower-income buyers and renters. Oak Bay is one of the B.C. communities where Albertans and Americans have sold vacation homes rather than pay tax.

RELATED: West Kelowna loses big development due to tax

The speculation tax was scaled back in March to exempt rural recreation properties.

The Gulf Islands, the Juan de Fuca region in Premier John Horgan’s constituency, Parksville and Qualicum Beach are being exempted. The municipalities of Nanaimo, Lantzville, Abbotsford, Chilliwack and Mission will still be included, as are the cities of Kelowna and West Kelowna, when the tax takes effect in 2019.

B.C. residents pay a lower rate rate for second homes in urban areas than owners from out of province or outside Canada. The tax takes effect on 2018 property value and stays at 0.5 per cent for B.C. residents with second homes. Residences that are rented out six months or more of the year will also be exempt from the tax, which was patterned after Vancouver’s “empty home tax” to discourage real estate speculators from pushing up prices.

BC legislatureUBCM

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

Just Posted

Revving up for the ride

Prince Rupert Harley Riders 39th annual toy run wheeled in toys and donations

Pineridge students learn about Orange Shirt Day

Students and teachers wore orange shirts designed by a SD 52 student to commemorate Sept. 30

Haida hereditary chief is BC Liberal Candidate for North Coast Region

Roy Jones Jr. is named BC Liberal MLA candidate for the North Coast

B.C. salmon farms challenge activists’ demands for site closures

News reporting also unfair, inaccurate and distorted

Swimming in the Street

Chris Street makes a coaching splash at PRASC

B.C. counts 125 new COVID-19 cases, up to 1,284 active

No new deaths or health care facility outbreaks

Lessons from a pandemic: How to design a nursing home that’s safe and love-filled

A look at how one care home is battling the pandemic with the social needs of the elderly in their care

B.C. salmon farm opponents demand answers from DFO

First Nations, conservation groups dismayed by omission of sea lice in risk assessments

Winter tires, chains now mandatory along most B.C. highways

Drivers without the proper winter tires – which must also be in good condition – can be fined $109

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Health Canada green-lights rapid COVID-19 test

Health Canada approved the BCube test from Hyris Ltd. in the United Kingdom Sept. 23

First Nations Health Authority chief medical officer concerned with rising COVID-19 cases

“There’s still so much we don’t know and we’re learning everyday about this particular virus.”

FINLAYSON: COVID-related job losses concentrated in urban areas… especially Metro Vancouver

The biggest job losses, in absolute terms, have been in Metro Vancouver

6 puppies rescued in mass seizure on Princeton farm die from illness: BC SPCA

Of the 97 distressed horses, cats and dogs seized, most of the puppies suffered from parvo

Most Read