B.C. Finance Minister Carole James updates B.C.’s employment situation under COVID-19 restrictions, B.C. legislature, July 10, 2020. (B.C. government)

B.C. Finance Minister Carole James updates B.C.’s employment situation under COVID-19 restrictions, B.C. legislature, July 10, 2020. (B.C. government)

B.C.’s potential deficit $12.5 billion as spending spikes, taxes drop

Finance Minister Carole James gives COVID-19 outlook

A combination of emergency pandemic spending and a steep drop in expected provincial taxes has B.C. projecting a potential deficit of $12.5 billion this year, Finance Minister Carole James says.

In an economic update July 14, James released projections of a $6.3 billion drop in sales and income taxes, natural resource revenues and Crown corporation income. Spending adds the rest to what started 2020 as a balanced budget with a $227 million surplus, adding a $6 billion more to the deficit.

James said the remaining $1.5 billion of the $5 billion emergency fund voted by the B.C. legislature will be allocated for economic recovery in September, after the government completes a public survey and continues meeting with business sectors on how to proceed.

Beyond the emergency spending for business and personal financial relief, more than $1 billion of the additional spending is in health care, including lab testing, supports for long-term care facilities, health prevention and contact tracing for COVID-19, and mental health supports. Another $250 million has been directed to maintain child care services.

Nearly $90 million has been directed to temporary housing, meal and health supports, in addition to $110 million to buy hotels to move people living in encampments.

Crown corporation income is projected to be down $882 million from the February budget forecast, which James said is mostly due to the shutdown of B.C. Lottery Corp. casinos due to the pandemic. ICBC costs have declined in the early part of the 2020-21 fiscal year due to a reduction in travel, but that could change as pandemic restrictions on travel are lifted and more people return to work, she said.

B.C. Liberal leader Andrew Wilkinson warned of the impact of B.C. tax deferrals that are expected to run out this fall.

“Back in May we suggested a 90-day break on employer health tax, sales tax and hotel tax to get the economy rolling again,” Wilkinson told reporters after the update. “And instead what we saw the NDP do is say, no, they’re just going to let it pile up until September, October and send a huge bill to all these businesses when they’re least able to pay it.”

RELATED: Canada, U.S. expected to extend border travel ban to late August

RELATED: Hotel rooms for homeless too hasty, NDP government told


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

BC legislatureCoronavirus

Just Posted

Dancers from the Sts’ailes First Nation perform the eagle dance at a welcome banner dedication ceremony on Thursday, June 10. “Ey Swayel” is a Halq̓eméylem term translated as ‘a good day.’ (Adam Louis/Observer)
VIDEO: ‘A good day’ for Agassiz school as Sts’ailes welcome banner is dedicated

Banner hangs above the school’s entrance, welcoming students, staff and visitors

Missing Abbotsford man Adam Hobbs was found deceased on Thursday evening (June 17).
Body of missing Abbotsford man Adam Hobbs found

Hobbs was reported missing Monday after leaving his job site in Langley

UFV athletes were honoured for their strength and perseverance during the pandemic. (UFV photo)
Fraser Valley athletes recognized in year without sports

UFV Cascades athletes honoured for strength shown during the pandemic

A tenant walks in front of her home on Boundary Road on Friday, June 18, 2021 after it was destroyed by fire the night before in Chilliwack. (Jenna Hauck/ Chilliwack Progress)
Chilliwack family homeless after fire rips through house on Abbotsford border

Turtle rescued, no one seriously hurt following Boundary Road fire in Chilliwack

Wild rabbits are all over Chilliwack, but people often think they’re someone’s lost pet and try to ‘save’ them. But the owner of Chilliwack’s Reptile Room says good intentions can have bad consequences for wild animals. (Photo by THE CANADIAN PRESS)
Owner of Chilliwack’s Reptile Room asks people to leave wild animals in the wild

Amber Quiring says people who think they’re helping are actually doing more harm than good

A small pod of Pacific white-sided dolphins pass by close to shore in Campbell River June 16, 2021. Still capture from video courtesy of Kimberly Hart
VIDEO: Dolphin sunset captured from Vancouver Island shore

Spectacular setting for view of travelling pod of Pacific white-sided dolphins

Police are asking for public assistance in locating Anthony Graham who has been charged with the murders of Kamloops brothers Carlo and Erick Fryer. (RCMP photo)
2 charged, suspect at large in killings of B.C. brothers linked to gang activity: RCMP

Kamloops brothers Erick and Carlo Fryer were found deceased in May on a remote Okanagan road

Albert Health Minister Tyler Shandro and Alberta Premier Jason Kenney unveil an opening sign after speaking about the Open for Summer Plan and next steps in the COVID-19 vaccine rollout, in Edmonton, Friday, June 18, 2021. THE CANADIAN PRESS/Jason Franson
Alberta 1st province in Canada to lift all COVID-19 public health restrictions

70.2% of eligible citizens 12 and older in the province have received a dose of the vaccine

Fraser Health registered nurse Ramn Manan draws a dose of the Pfizer COVID-19 vaccine into a syringe at a walk-up vaccination clinic at Bear Creek Park, in Surrey, B.C., on Monday, May 17, 2021. THE CANADIAN PRESS/Darryl Dyck
‘Honour our fathers’ with COVID-19 vaccine protection, B.C. urges

109 new cases Friday, 75 per cent of 12 and up immunized

(Paul Henderson/ Chilliwack Progress)
Trutch Avenue in Chilliwack to be renamed to remove racist taint

New name to have Indigenous significance as Chilliwack takes new step toward reconciliation

Canadian Prime Minister Justin Trudeau is seen during a joint news conference following the EU-Canada Summit, in Brussels, Belgium, Tuesday June 15, 2021. Trudeau says Canada is on track now to have 68 million doses delivered by the end of July, which is more than enough to fully vaccinate all 33.2 million Canadians over the age of 12. THE CANADIAN PRESS/Adrian Wyld
Vaccine deliveries enough to fully vaccinate all eligible Canadians by end of July

Three in four eligible Canadians now have their first dose, nearly one in five fully vaccinated.

A search is underway for a 75-year-old fisherman who went missing near Port Angeles Thursday evening. (Courtesy of U.S. Coast Guard)
Search continues for angler missing between Port Angeles and Victoria

Canadian, U.S. Coast Guard searching for 75-year-old man reported missing Thursday evening

Chief Public Health Officer Theresa Tam listens to a question during a news conference, in Ottawa, Tuesday, Jan. 12, 2021. The number of confirmed COVID-19 cases attributed to the highly contagious Delta variant grew in Canada this week. THE CANADIAN PRESS/Adrian Wyld
Canada’s public health agency reports spike in confirmed cases of Delta variant

More than 2,000 cases of the variant confirmed across all 10 provinces and in one territory

Bella Bella is on B.C.’s Central Coast, accessible only by air and ocean. (Tom Fletcher/Black Press)
B.C. provides $22 million for Heiltsuk development on Central Coast

Elders care home project, tourism, lumber mill supported

Most Read