Public Finance & Taxation
Despite an enviable fiscal position, B.C. has seen an erosion of its tax competitiveness, in particular driven by the loss of the business-boosting HST.
Government has a responsibility to ensure the judicious use of taxpayer dollars.
As one of only two Canadian jurisdictions with a balanced budget, B.C. has developed a reputation for fiscal prudence. This fiscal restraint has seen public spending contained and debt levels low compared to many other jurisdictions.
While B.C. is in an enviable fiscal position, we have seen an erosion of B.C. tax competitiveness. B.C. is highly competitive globally when it comes to corporate, personal and small business tax rates. Despite this record, B.C. has seen its competitive position slip considerably, particularly as it relates to our export industries.
The BC Chamber's goal is to ensure that B.C. retains its reputation for sound fiscal management. Key aspects of this reputation must be constraining growth in public spending, reducing B.C.’s debt burden and continuing to innovate in service delivery.
Further to this, the Chamber's goal is to create a tax system that attracts investment and encourages business growth.
We recommend that the provincial government:
- continue to limit public spending to the rate of population and economic growth,
- dedicate no less than 50% of surpluses to debt reduction in provincial budgets,
- legislate a requirement that no less than 50% of all surpluses be dedicated to debt reduction,
- lead a public discourse on the development of a made-in-B.C. VAT
- address the most pressing issue around the PST by removing the PST on the purchase of machinery and equipment,
- work with business to mitigate the impact of the carbon tax on B.C.’s export industries, and
- return the revenue neutrality of the B.C. carbon tax to broad-based personal and corporate tax cuts.