‘Disciplined’ Budget Offers No Surprises

Finance | BCBusiness
Finance Minister Mike de Jong delivers the 2014 budget

The 2014 provincial budget offers a few perks for homeowners, filmmakers; no details for LNG producers

Finance Minister Mike de Jong tabled the 2014 budget today, projecting surpluses of $175 million for the fiscal year ending March 31, 2014 and $184 million the following year.
Describing it as a “disciplined” budget, de Jong offered no big surprises in spending cuts or increases.
The budget does not specify tax details for LNG facilities, but de Jong outlined a two-tier framework whereby LNG producers will pay up to 1.5 per cent of income in the first tier, graduating to a second tier with rates as high as seven per cent once they have recovered the capital cost of developing their facilities. The province plans to table legislation specifying details this fall.
De Jong acknowledged that the province does not recognize any LNG revenue in its three-year economic projections, since no taxes will be collected until production begins.
Among increases to social services, de Jong announced an additional $243 million in funding over three years for Community Living B.C., for adults with developmental disabilities, and another $15 million for children with special needs. De Jong also announced an additional $146 million in funding for the BC Early Childhood Tax Benefit, which starting in April 2015 will provide up to $55 a month for each child under the age of six.
The budget includes an increase in health-care spending of $385 million this fiscal year, bringing the projected total to $16.9 billion. MSP premiums will increase approximately four per cent.
The budget includes $2.3 billion in capital spending by post-secondary institutions over the next three years, including funding for new trades training facilities at Camosun College in Victoria, new trades training facilities at Okanagan College in Kelowna and a new campus for the Emily Carr University of Art and Design.
The budget expands an existing tax break for first-time home buyers: the threshold for exemption from the provincial property transfer tax increases from $425,000 to $475,000.
Without singling out any particular sectors, de Jong noted in his budget speech that public-sector wages account for 57 per cent of provincial spending, and said he wanted to “pay tribute” to those who have “found creative ways to keep public services affordable.”
De Jong acknowledged that the province hasn’t achieved its job-growth projections, saying that working with the private sector to stimulate growth and employment opportunities is a long-term initiative.
The budget also includes a small provision aimed at luring filmmakers to Vancouver Island, extending an existing Distant Location Tax credit to the Capital Region for any productions beginning after today.