B.C. Budget 2014-15: Balanced, But That’s About It

By Jordan Bateman, BC CTF. The Canadian Taxpayers Federation congratulated the B.C. Liberal government today on delivering a second straight balanced budget, but expressed concern over Medical Service Premium (MSP) tax hikes and a lack of a debt reduction plan.

“It hasn’t been easy, with a slower-than-expected economic recovery, a plunging Canadian dollar, and sluggish job numbers, but the B.C. Liberals have held the line on spending and met the litmus test of a successful budget: balance,” said Jordan Bateman, CTF B.C. Director. “It’s not a perfect or exciting budget, but balance is an accomplishment that deserves recognition.”

While the budget is balanced, the overall provincial debt will continue to grow by a quarter billion dollars every month. This is down from last year’s projections, but still a concern for the CTF.

The CTF noted there was no mention of a Debt Reduction Act, as promised in last year’s election campaign. The CTF supports using 75 per cent of every surplus to pay down debt.

“The B.C. debt clock will keep spinning on up,” said Bateman. “When Premier Clark took office in 2011, the debt was $45 billion. By 2017, it will be $69 billion. We’re a long, long way from a debt-free B.C., but a Debt Reduction Act would get us a little closer to that goal, and keep special interest groups from co-opting the surplus for their own programs.”

The government continues to hamstring its own jobs plan by raising the Medical Services Premium (MSP) tax for the sixth straight year. The latest increase will drive a family’s MSP tax to $144 per month, up from $108 in 2009 – a 33 per cent rise in just six years.

“Payroll taxes are job killers,” said Bateman. “This constant push for more MSP tax, along with Ottawa’s CPP and EI hikes, makes it more expensive to employ people in B.C. This hurts job creation – the very thing Victoria should encourage.”

The provincial government also unveiled its Liquefied Natural Gas (LNG) tax framework, which includes an extra, tiered LNG industry tax on plants.

“It’s still early in the LNG tax process, but the scheme seems reasonable,” said Bateman. “It appears to be competitive internationally, while still offering B.C. taxpayers a strong return on our natural gas resources. If these plants do materialize, B.C.’s economy will obviously benefit greatly.”

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