British Columbia seems stuck in a place where a home and everything else is unaffordable. It’s harder than ever to get a business started and keep it rolling. And the David Eby government can’t seem to move things forward as it shifts between neutral and reverse.
A from the Greater Vancouver Board of Trade makes it clear that the Eby government needs to cut taxes to give job creators a break.
The board’s recommendations are a great start and sa国际传媒 can go much further.
Small businesses employ more than one million British Columbians and make up around one-third of the provincial GDP. of Trade, between 2022-24, businesses in sa国际传媒 are expected to pay a cumulative $6.5 billion in additional costs imposed by the government – even after accounting for savings measures.
The sa国际传媒 government needs to cut the cost of doing business.
Here’s what is should do:
The Board of Trade recommends the employer health tax (EHT) threshold for small and medium business be increased, the introduction of PST exemption on business inputs, a reduction in the provincial portion of commercial property taxes and the implementation of a “made-in-sa国际传媒 carbon pricing system.”
According to the sa国际传媒 , the EHT is “a tax on hiring and job creation that hits small businesses … once their total payroll hits $500,000.” Out of the four provinces that have a similar EHT with thresholds before it kicks in, sa国际传媒’s is by far the lowest. In Manitoba, their EHT doesn’t kick in until payroll hits $1.5 million. In Ontario, the province with the next lowest EHT threshold, businesses start paying the EHT once their payroll hits $1 million.
In 2019, the first year that the EHT existed, it cost British Columbian businesses around .
It’s wrong to tax businesses for hiring people. sa国际传媒’s government should abolish the EHT to allow for businesses to grow and employ more people without being punished through extra payroll taxes. Scrap it.
The Board of Trade is also right to recommend PST exemptions on business inputs like computers, telecommunications, machinery and equipment. This year, the cost of PST on British Columbians is expected to balloon from $9.7 billion at the end of 2022, to by the end of 2023. There’s certainly room to give businesses a break.
Federally, for GST on business inputs, like those identified by the Board of Trade, already exist. On a federal level, input tax credits allow job creators to remove most, if not all, GST on business inputs – clearly sa国际传媒 is lagging behind when it comes to supporting small business.
Meanwhile, over in Alberta, taxpayers and businesses aren’t hit with a PST at all. That leaves more money in people’s pockets to reinvest in local business.
Property taxes are also making doing business in sa国际传媒 unaffordable. The cost of real estate, including property tax, was identified as one of the that businesses in Metro Vancouver will be facing over the next three months.
The Board of Trade recommends that the government reduce the provincial portion of commercial property taxes. That’s a good first step, but to bring the cost of real estate down, both the province and municipalities need to reduce property taxes.
Property taxes don’t just make doing business in Vancouver unaffordable, they are also making it almost impossible to rent or own a home in the Lower Mainland. The two biggest cities in Metro Vancouver, and , both approved double-digit property tax hikes this year.
For , that property tax hike means that an average homeowner will be on the hook for an extra $326 in taxes, while your average Vancouver business will pay an extra $549 in property taxes alone in 2023.
sa国际传媒’s government is already expected to raise through land-transfer taxes. Home costs are already soaring. Taxes are one of the factors pushing them higher.
The board’s final recommendation is to replace the provincial carbon tax with a “made-in-sa国际传媒 carbon pricing system.”
According to the Board of Trade, “it is very likely” that the carbon tax will cost businesses in sa国际传媒 $2.9 billion over the next three years.
In Metro Vancouver, the total tax on a litre of gasoline averages about 78 cents. That means it costs about $60 extra to fill up your average minivan. Taxing the trucks and vehicles that businesses use to transport their goods means that everything costs more.
According to a recent report by the , carbon taxes are both regressive and do not “materially impact climate change.” It’s wrong for Eby to be punishing British Columbians with a tax that doesn’t meet its objectives, while also hurting the people who can afford it the least.
The solution is more than swapping titles on a carbon tax. It’s time to scrap it.
Eby needs to get serious about cutting taxes for businesses to get ahead. Taxpayers are tapped-out and job creators can’t create jobs in a hostile economic environment.
Carson Binda is the British Columbia Director of the Canadian Taxpayers Federation.
