Your BC Advocacy team attended the province’s 2020 budget to get the scoop on what the government’s agenda will be going forward this year. Here is our recap of the budget, what will matter for your business, and how we will continue to advocate for your priorities:
Any tax relief for your business?
Unfortunately, no meaningful tax relief or measures were introduced, besides a few very niche initiatives (e.g. PST exemption on electric aircrafts, a new property tax rate for major industry port properties, etc. If you think any of these initiatives could benefit your business, please call our business resources center for more information). It is extremely disappointing to see a lack of initiative to support the business community in British Columbia, especially as your business tries to afford new and rising costs over the past few years (e.g. Employer Health Tax, Minimum wage, rapidly rising property taxes). This is why we will continue to make it a priority to advocate for greater tax relief, less regulatory processes to make getting things done easier for your business, and greater consultation with small business owners and organizations who represent them. There is a big gap in what the province could be doing to greater support your business, and we will be meeting with key Ministers and government officials to have your voice heard while advocating for meaningful action and support.
A balanced budget balanced
Three years of surplus are projected – this comes as good news, as we know our BC membership highly value fiscal responsibility. The estimated surplus for 2020/21 is $227 million, which is however a relatively small surplus. As the province continues forward with years of surplus, we will be pushing hard over the following years for them to use this opportunity to support your business by offering tax reductions and supporting business friendly initiatives.
A higher tax on BC’s highest earners
The province is issuing a higher tax rate on the top 1% of earners (i.e. on taxable income over $220,000, which will now be taxed at 20.5%). This new tax rate is effective January 1, 2020.
NEW TAX: Does your business sell carbonated, sweetened beverages?
Effective July 1, 2020, carbonated beverages containing sugar, natural sweeteners or artificial sweeteners will no longer be exempted from the provincial sales tax. This includes all beverages dispensed through soda fountains, soda guns, and vending machines. This will impact our restaurant and bar members in terms of them having to charge customers PST on these items. As this is intended to be a disincentive to consume pop, our members offering these beverage may see a decline in sales. Please call into our business resources if you have any questions or concerns about how this tax change will impact your business.
NEW TAX: Does your business sell heated tobacco products?
Effective April 1, 2020: a new default tax of 29.5 cents per heated tobacco product is being introduced. A Heated tobacco product is defined as one that contains tobacco designed to be heated, but not combusted, in a tobacco heating unit to produce vapour (i.e. vapes). Any members currently selling heated tobacco products in BC will be required to inform the director of their intent to continue selling heated tobacco products by April 30, 2020. Please call into our business resources if you have any questions or concerns about how this tax change will impact your business.
If you would like to read the BC Budget 2020, click here.
If you would like to view all budget related materials from the province, including a summary of the highlights, click here.
If you have any questions about the BC Budget or its content, please contact Business Resources at 1-888-234-2232 so we can help. Thank you for your ongoing support, including taking part in our surveys so we can put your voice in front of government.