“Voters want conflicting things. They want a lot of government spending, but they don’t want higher taxes” – Bruce Rauner
BC Provincial Budget Announced
This week, the BC NDP government presented its 2020 Budget. Overall, the Budget calls for surpluses in 2019/20 ($203 Million), 2020/21 ($227 Million), 2021/22 ($179 Million) and 2022/23 ($374 Million).
Below are the highlights from the Budget announcement:
New Highest Provincial Tax Bracket
The province is adding a new highest tax bracket. The new bracket starts at $220,000 and will increase from 16.8% up to 20.5%. The province says BC will have the third-lowest rate for those earning $475,000 per year.
With the province ahead of its target to get electric vehicle sales to 10% of all vehicle sales by 2025 (currently at 9%), the Budget allows for a continuation of the $3,000 credit for new EV purchases with an additional $20 Million of funding.
Another $5 Million in funding will be allocated to build more charging stations both at homes and at workplaces.
The province will no longer exempt sweetened carbonated drinks from PST. The province estimates $27 Million in revenue from this tax in 2020 and ~$37 Million in revenue in 2021.
BC Child Opportunity Benefit
Starting in October, the BC Child Opportunity Benefit will make families with one child eligible to receive up to $1,600 per year, and families with two children eligible for up to $2,600 per year.
BC Access Grant
Low- and middle-income post-secondary students will now be eligible for “needs-based” grants. Students in programs up to 2 years in length may be eligible for up to $4,000 a year, while students in programs greater than 2 years may be eligible for up to $1,000 a year.
Reducing Surgery Wait Times
Health care is the highest-funded program once again, and special attention is being paid to reducing wait times for some surgeries.
The Budget allows for $50 Million to help address wait times, though the specific surgeries to be focused on has not been finalized.
The province will provide $339 Million in funding over the next three years, with the intention to hire ~4,200 more teachers. However, the allotment does not provide for wage increases for existing teachers above the mandated 2% per year.
The Budget calls for $56 Million in additional funding to build 200 more temporary modular housing units, aimed at getting homeless people and people at risk of becoming homeless off the street.
After states of emergency were declared in 2017 and 2018, the 2019 “fire season” was not as severe. Still, the Budget calls for an increase of $35 Million in funding to fight wildfires, with overall funding rising to $136 Million.
Forestry Sector Assistance
The forestry sector has been hard-hit, with projections of $867 Million in revenues for 2020/2021, down from the $1.14 Billion projections from a year ago. The Budget allows for $13 Million to help support the struggling industry.
Money Laundering Public Inquiry Funding
The province is allocating $11 Million to fund inquiries into money laundering in casinos, real estate and luxury car markets.
Illegal Pot Crackdown
The Budget allows for $12 Million to enforce compliance & enforcement on illegal marijuana sales.
Weekly Update – By The Numbers
|North America||Friday Close||Weekly Change||Weekly % Change||YTD % Change|
|Canada – S&P TSX Composite||17,842||-6||-0.03%||4.57%|
|USA – Dow Jones Industrial Average||28,992||-406||-1.38%||1.59%|
|USA – S&P 500||3,338||-42||-1.24%||3.31%|
|USA – NASDAQ||9,577||-154||-1.58%||6.73%|
|Gold Futures (USD)||$1,645.90||$58.90||3.71%||8.28%|
|Crude Oil Futures (USD)||$53.34||$1.17||2.24%||-12.86%|
|CAD/USD Exchange Rate||€ 0.7566||€ 0.0020||0.27%||-1.74%|
|Europe / Asia||Friday Close||Weekly Change||Weekly % Change||YTD % Change|
|MSCI World Index||2,403||-28||-1.15%||1.91%|
|Switzerland – Euro Stoxx 50||3,800||-41||-1.07%||1.39%|
|England – FTSE 100||7,404||-5||-0.07%||-2.01%|
|France – CAC 40||6,030||-39||-0.64%||0.87%|
|Germany – DAX Performance Index||13,579||-165||-1.20%||2.49%|
|Japan – Nikkei 225||23,387||-301||-1.27%||-1.14%|
|China – Shanghai Composite Index||3,040||123||4.22%||-0.33%|
|CAD/EURO Exchange Rate||€ 0.6971||€ 0.0006||0.09%||1.56%|
|Fixed Income||Friday Close||Weekly Change||Weekly % Change||YTD % Change|
|10-Year Bond Yield (in %)||1.4710||-0.1190||-7.48%||-23.35%|
Sources: Gov.BC.ca, Global News, Yahoo! Finance, CNBC.com
This information is provided for general information purposes only. It does not constitute professional advice. Please contact a professional about your specific needs before taking any action.