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

Delta police campaign shines a light relationship violence

Campaign comes after a Delta man was charged with assault with a weapon and uttering threats

Seniors plead to Surrey council ahead of public hearing for 1,000-plus unit development

In June, seniors in the buildings said they felt ‘left in the cold’ as plans for redevelopment materialized

Surrey RCMP asks for public’s help to find missing 15-year-old boy

Prabhjot Singh Gill was last seen Dec. 6 in the area of 140th Street and 66th Avenue

Surrey 37 per cent behind in housing supply projections

Of 18 cities in Metro Vancouver, only City of North Vancouver and Richmond met or exceeded projections

Several people in custody following reports of shots fired into a Surrey home

Police say the incident happened in the early hours of Saturday morning

VIDEO: Boys help rescue Cariboo bear cub

The cub, weighing just 24lbs, has been taken to wildlife sanctuary in Northwest B.C. for the winter

Campbell River mom’s iPhone containing priceless photos stolen from Victoria hospital parkade

The phone contained photos, heartbeat recordings of her late son

Miller nets winner as Canucks edge Sabres 6-5 in OT

Roussel, Leivo tally two apiece for Vancouver

‘Norovirus-like’ outbreak interrupts Bantam hockey showcase in Greater Victoria

Several athletes were sent home, quarantined on the ferry

Strong turnout of volunteers to search for missing senior

Ted Vanderveen disappeared in rural Maple Ridge on Nov. 28

$578: that’s how much your first distracted driving ticket will cost with recent premium hikes

Over 50 per cent of Canadians admitted to using phone while driving last year, according to study

SkyTrain strike to begin Tuesday with ‘full shutdown’, CUPE says

BCRTC president says job action is ‘completely unacceptable’ to use SkyTrain users ‘as leverage’

Kelowna man attempts to steal bait bike from RCMP parking lot

38-year-old Brian Richard Harbison is facing several charges

Owners of hotels on Vancouver’s Downtown Eastside fight $1 expropriation in court

Vancouver City Council voted to expropriate the properties for $1 each in November

Most Read