British Columbians are bracing for several new taxes set to take effect in the new year.
Businesses will start paying the province’s new Employers Health Tax on Jan. 1 – a tax announced earlier this year by the B.C. NDP to replace the costs of the Medical Service Plan premiums. Those premiums will remain in effect until 2020.
Kris Sims, B.C. director of the Canadian Taxpayers Federation, said in a news release Thursday that stacking the new tax on the pre-existing MSP premiums creates a double-dip of taxation on many B.C. employers for the year, including municipalities.
The new tax impacts businesses that have a payroll of more than $500,000, with a 1.95 per cent tax set on businesses with a payroll of over $1.5 million. Sims said this forces many cities to look to budget cuts or increase property taxes – a move already in the works in some regions.
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In June, Finance Minister Carole James said that replacing MSP premiums follows the lead of other provinces, in a much fairer and progressive way.
She also said that most municipalities will be able to absorb the cost, which would at its highest equate to $40 per household in additional taxes or fees.
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Other taxes taking effect through 2019 include the controversial school tax, an increase to B.C.’s carbon tax and an increase to the TransLink tax for motorists in parts of the Lower Mainland.
The school tax applies to homes valued at more than $3 million, which is then placed into general revenue.
A tax increase of 0.2 per cent will be placed on the residential portion of a property valued above $3 million. It would increase to 0.4 per cent on the portion above $4 million.
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The carbon tax, which impacts everyone across the province, will go up from $35 a tonne to $40 on April 1. Meanwhile, FortisBC will be increasing its residential customer rate by nine per cent – an interim rate approved by the B.C. Utilities Commission.
Metro Vancouver motorists will see tax rates on gas jump from 17 cents per litre to 18.5 cents.
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Then there’s the proposed 6.3 per cent ICBC rate hike, which is being reviewed by the commission. If approved, it will take effect in April and increase basic insurance rates by an average of $60.
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