Chamber says B.C. budget has short term gains, long term pains

The Kelowna Chamber has dissected the new B.C budget, and concludes the fiscal plan “has a few small nuggets for business, but is awash in red ink going forward.”

“Aside from increasing deficits over the course of the three-year plan, the debt-to-GDP ratio will also balloon to 27.5 per cent from 17.6 per cent. This is the metric that the credit agencies use when setting the Province’s credit rating which impacts the cost of borrowing,” a chamber news release stated.

The business organization says it’s not known yet what impact that will have on B.C.’s once solid triple A credit rating, something the previous NDP governments under John Horgan managed to keep under control.

Chamber CEO Dan Rogers said achieving a balanced budget may be an aspirational goal of the government, but this plan appears to go in the opposite direction.

“On the plus side, doubling the Employer Health Tax threshold from half a million to one million dollars will enable some businesses to lower their costs,” Rogers commented. “It’s an ask we’ve made since the tax was introduced.”

The chamber said there are some other wins for business including a tax incentive aimed at encouraging more purpose-built rental construction.

The government also introduced a modest one-time BC Electricity Affordability Credit that reduces electricity costs for residential, commercial, and industrial users, something Rogers says will be welcomed, particularly in the mining sector.

The CEO said dedicated funds in the budget for the development of a Critical Minerals Strategy should also help with needed economic growth and investment in BC Builds should wrestle down the ever-increasing cost of housing.

Rogers added the Kelowna Chamber will continue to push for the region’s fair share of public dollars for affordable housing while also reminding government of the need to reduce the costs of housing and development.

“This budget will move the needle in addressing the need for more affordable housing and there is also some help for those facing economic hardship, but overall, the budget isn’t likely to be a game changer when it comes making B.C. a highly competitive jurisdiction that attracts greater investment and job creation,” Rogers remarked.