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

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

People skate on a lake in a city park in Montreal, Sunday, January 10, 2021. THE CANADIAN PRESS/Graham Hughes
The end of hugs: How COVID-19 has changed daily life a year after Canada’s 1st case

Today marks the one year anniversary of COVID-19 landing in Canada

A member of the Avalanche Canada South Rockies field team gathers important snowpack data that is used to produce daily avalanche forecasts for the region. (Photo by Jennifer Coulter)
Avalanche Canada receives $180k for office renovations

The money was granted through Community Gaming Grant

The rocks are painted and then hidden around town. Those who find them can keep them, leave them where they are or hide them elsewhere. (Submitted)
Spreading love and kindness in Nakusp

New group launched to nurture rock painting and hunting community

The Okanagan Regional Library is holding a pair of online contests for its young readers. (File photo)
Okanagan Regional Library challenges young readers

Pair of contests online aimed at kids aged up to 18

Rose Sawka, 91, waves to her son through the window of a care home in Prince Rupert in October. Residents of the care home received their first vaccine dose Jan. 20. (K-J Millar/The Northern View)
B.C. care home visitor access to expand by March, Dix says

Staff, residents, essential visitors top priorities for vaccine

Group of cowboys on horses out rounding up cattle, 1888. The Greater Vernon Museum and Archives is celebrating Vernon Winter Carnival’s Wild West theme with a virtual trip back in time looking at the ranching days. (GVMA #5021)
Museum rounds up North Okanagan’s wild west past

Vernon Winter Carnival event, Meanwhile…Back at the Ranch, Feb. 9

Virtual programming will assist the Allan Brooks Nature Centre Society in spreding environmental education. (ABNCS photo)
North Okanagan nature centre online with gaming grant

Allan Brooks Nature Centre Society benefits from provincial funds

Penticton Search and Rescue completed two rescues in succession of each other Saturday, Jan. 23, 2021 afternoon. (PENSAR / Facebook)
Penticton Search and Rescue members execute back-to-back rescues

PENSAR had barely completed their first rescue of the day when they received a second call

Three cars had their tires slashed in Vernon over the weekend. (Contributed)
Tires slashed at three North Okanagan residences

RCMP investigating Okanagan Landing-area incidents

Kyrell Sopotyk was drafted by the Kamloops Blazers in 2016 and played two seasons with the Western Hockey League club. (Photograph By ALLEN DOUGLAS/KTW)
Kamloops Blazer paralyzed in snowboarding accident sparks fundraiser for family

As of Jan. 24, more than $68,000 had been raised to help Kamloops Blazers’ forward Kyrell Sopotyk

Join Black Press Media and Do Some Good
Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Rodney and Ekaterina Baker in an undated photo from social media. The couple has been ticketed and charged under the Yukon’s <em>Civil Emergency Measures Act</em> for breaking isolation requirements in order to sneak into a vaccine clinic and receive Moderna vaccine doses in Beaver Creek. (Facebook/Submitted)
Great Canadian Gaming CEO resigns after being accused of sneaking into Yukon for vaccine

Rod Baker and Ekaterina Baker were charged with two CEMA violations each

(Pixhere photo)
B.C. dentists argue for COVID-19 vaccine priority after ‘disappointing’ exclusion from plan

Vaccines are essential for dentists as patients cannot wear masks during treatment, argues BCDA

Most Read