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

B.C. storm totals $37M in insured damages

The December storm wreaked havoc on B.C.’s south coast

Miniature horses visit Glacier View residents

Glacier View Lodge residents had a couple of special visitors on Wednesday… Continue reading

Annual women’s march in Courtenay Saturday

The Women’s March was a worldwide protest on Jan. 21, 2017, to… Continue reading

Portables arrive for students on Hornby Island

Five portable classrooms have officially arrived on Hornby Island this week in… Continue reading

Cumberland multi-use development given the go-ahead despite parking concerns

Rideout Construction will pay $91,200 in lieu of 24 parking stalls

Trudeau says politicians shouldn’t prey on Canadians’ fears

The Prime Minister was speaking at a townhall in Ontario

Chiasson nets shootout winner as Oilers edge Canucks 3-2

Edmonton moves one point ahead of Vancouver

B.C. chief says they didn’t give up rights for gas pipeline to be built

Hereditary chief: no elected band council or Crown authority has jurisdiction over Wet’suwet’en land

Thieves steal thousands from 140 Coast Capital Savings members

Online fraud tactics included phising and ‘brute force’ in November and December

Condo rental bans may be on way out with B.C. empty home tax

Many exemptions to tax, but annual declarations required

UPDATE: B.C. boy, aunt missing for three days

The pair are missing from Kamloops

Daredevil changes game plan to jump broken White Rock pier

Brooke Colby tells council daredevil event would help boost waterfront business

Liberal bows out of byelection after singling out Jagmeet Singh’s race

Karen Wang says she made comments online that referenced Singh’s cultural background

Most Read