Finance Minister Mike de Jong presents the 2016-17 budget in the B.C. legislature Tuesday.

Finance Minister Mike de Jong presents the 2016-17 budget in the B.C. legislature Tuesday.

BC BUDGET HIGHLIGHTS: Real estate, MSP, disability benefits

Luxury tax on new homes over $2 million, children exempted from rising medical fees, prosperity fund without LNG revenues

Property transfer tax trimmed

Newly built homes worth up to $750,000 are exempt from B.C.’s property transfer tax under changes in the provincial budget that take effect immediately.

Finance Minister Mike de Jong expects to make up most of the lost revenue by increasing the tax rate from two to three per cent on the value of homes in excess of $2 million.

For resold homes, property purchase tax continues to apply at one per cent on the first $200,000 of value and two per cent on value between $200,000 and $2 million.

The tax has produced a windfall for the province and pushed home purchase costs even higher in the hot market for homes in some urban areas. The government expects to collect about $200 million more than it budgeted for the current year, due to soaring prices and a high number of sales.

De Jong said the break is aimed at new construction to stimulate new housing construction, adding to supply in response to demand that is driving prices up.

The exemption is only available to Canadian citizens and permanent residents, and the government is resuming tracking nationality of buyers, a practice stopped in 1998.

The upper limit to qualify for the homeowner grant is also increased from $1.1 million to $1.2 million for the 2016 property tax year.

Children exempted from MSP premiums

Medical Services Plan premiums are being charged only for adults starting in 2017, and the qualifying income for reduced premiums is going up from $30,000 to $42,000 for single people.

The new system creates a break for single parents, who will pay a single adult rate of $78 a month  instead of the current rate of $150 charged for a family of three. A single senior or single parent with one child and an income of $45,000 may also be eligible for reduced premiums.

The changes will reduce rates for an additional 335,000 people, and 45,000 more people will be exempted from paying as long as they are registered and qualify. But rates overall continue to rise. With a four per cent increase in personal rate this year and growing population, the government expects to collect more MSP each year of its three-year budget plan than with the current system.

B.C. is the only province that charges premiums for health services, and the NDP opposition has called for them to be eliminated as a regressive tax. De Jong argues that MSP covers only 14 per cent of a growing health care budget, and eliminating it would amount to hiding the cost in the general tax system.

Prosperity fund gets seed money

With liquefied natural gas export projects delayed, Premier Christy Clark’s promise of a “B.C. Prosperity Fund” has been launched with $100 million from the current budget surplus.

The fund was touted in the 2013 election as a way to pay off debt starting in 2017, and reduce or even eliminate B.C.’s sales tax with revenues from five LNG plants. But with a glut of oil and gas internationally, no major project is expected to be under construction by the 2017 election.

Including the fund in his 2016-17 budget, Finance Minister Mike de Jong said most people would agree with “the notion that we would take a modest amount of money out of our chequing account and put it in our savings account.”

The finance ministry expects a surplus of $377 million at the end of the current fiscal year and $264 million in the fiscal year that begins April 1.

The prosperity fund is restricted to a minimum 50 per cent to pay down debt, 25 per cent saved to earn interest and the rest available to spend on health care, transportation and other government functions.

Disability benefits up $77 for some

Income assistance payments for people with disabilities are to increase up to $77 per month effective Sept. 1, but transit passes will no longer be covered.

Bus passes have only been provided for some regions of the province, an unfair situation for those who can’t take advantage of transit, said Finance Minister Mike de Jong. The increase will be across the board and recipients can choose for themselves if they use it for transit or other needs.

The B.C. Liberal government has resisted calls for an increase in the general social assistance rate, but has ended the clawback of child support payments to single parents.

Since 2012 the government has moved to encourage income assistance recipients to work, allowing earnings up to $200 a month without losing benefits for those who file tax returns.

People on disability assistance can retain up to $800 a month, up from $500 in 2012.

 

Just Posted

From left: Thomas Kuecks, David Lane, John Ivison, Denis Berger, Rod Gray, and James Kuecks are Cabin Fever. Catch their performance on the Cowichan Performing Arts Centre website. (Ashley Foot photo)
A&E column: Music Festival winners, CVAC awards, and Cabin Fever

The latest from the Cowichan Valley arts and entertainment community

BC Green Party leader and Cowichan Valley MLA Sonia Furstenau introduced a petition to the provincial legislature on Thursday calling for the end of old-growth logging in the province. (File photo)
Cowichan Valley MLA Furstenau introduces old-growth logging petition

BC Green Party calls for the end of old-growth logging as protests in Fairy Creek continue

The city-owned lot at 361 St. Julien St., which has been home to a temporary homeless site for more than a year, will be sold and plans are to build a three-storey mixed-use development there, Peter de Verteuil, Duncan CAO explained at a recent council meeting. (File photo)
New development planned for homeless site in Duncan

Lot on St. Julien Street would see three-storey building

Historian and longtime Citizen columnist T.W. Paterson photographs the historical wreckage of a plane on Mount Benson. Paterson recently won an award from the British Columbia Historical Foundation. (Submitted)
Cowichan’s Tom W. Paterson wins award for historical writing

British Columbia Historical Federation hands Recognition Award to local writer

This electric school bus is the newest addition to the Cowichan Valley School District’s fleet. (Submitted)
Editorial: New electric school bus good place to start

Changing public transit like buses to electric really is important.

People line up to get their COVID-19 vaccine at a vaccination centre, Thursday, June 10, 2021 in Montreal. THE CANADIAN PRESS/Ryan Remiorz
Vaccines, low COVID case counts increase Father’s Day hope, but risk is still there

Expert says people will have to do their own risk calculus before popping in on Papa

The Co-op gas station at Whiskey Creek is burning after a camper van exploded while refueling just before 4 p.m. on Thursday, June 17, 2021. (FACEBOOK PHOTO)
Exploding camper van torches Highway 4 gas station between Qualicum Beach and Port Alberni

Highway traffic blocked after Whiskey Creek gas station erupts into flames

Helen Austin performing with Trent Freeman at the 2018 Vancouver Island MusicFest. Austin is one of the many performers listed for the 2021 event.
Vancouver Island MusicFest goes virtual for 2021

Black Press to stream 25 hours of programming July 9-11

Greater father involvement in the home leads to improved childhood development and increased marital satisfaction, says expert. (Black Press Media file photo)
Vancouver Island researcher finds lack of father involvement a drag on gender equality

Working women still taking on most child and household duties in Canada: UVic professor

FILE – A science class at L.A. Matheson Secondary in Surrey, B.C. on March 12, 2021. (Lauren Collins/Surrey Now Leader)
Teachers’ union wants more COVID transmission data as B.C. prepares for back-to-school

BCTF says that details will be important as province works on plan for September

Provincial health officer Dr. Bonnie Henry outlines B.C.’s COVID-19 restart plan, May 25, 2021, including larger gatherings and a possible easing of mandatory masks on July 1. (B.C. government photo)
B.C. records 120 new COVID-19 cases, second vaccines accelerating

Lower Pfizer deliveries for early July, Moderna shipments up

A Heffley Creek peacock caught not one - but two - lifts on a logging truck this month. (Photo submitted)
Heffley Creek-area peacock hops logging trucks in search of love

Peacock hitched two lifts in the past month

The Calgary skyline is seen on Friday, Sept. 15, 2017. THE CANADIAN PRESS/Jeff McIntosh
2 deaths from COVID-19 Delta variant in Alberta, 1 patient was fully immunized

Kerry Williamson with Alberta Health Services says the patients likely acquired the virus in the hospital

The first suspension bridge is the tallest in Canada, with a second suspension bridge just below it. The two are connected by a trail that’s just over 1 km. (Claire Palmer photo)
PHOTOS: The highest suspension bridges in Canada just opened in B.C.

The Skybridge in Golden allows visitors to take in views standing at 130 and 80 metres

Most Read