B.C. Business Matters:
Let's Tax the Rich - Oh, We Already Do
Last week’s budget offers a timely reminder of something that many Canadians may not realize: a surprisingly large proportion of federal government revenue comes from the personal income tax (PIT). The second biggest revenue source is the corporate income tax, followed by the GST. According to the budget, in the upcoming fiscal year Ottawa’s PIT revenue will reach $131.5 billion, which amounts to half of all of the money collected by the national government.
Who pays the personal income tax? Most Canadian households except those with quite low incomes generally pay something. But an examination of data recently released by the Canadian Revenue Agency indicates that the PIT burden falls mainly on the most affluent families. Consider the following summary statistics:
Coal in the Local Spotlight
The Mayor or Vancouver recently tabled a motion “to prevent the expansion of, or creation of new, coal export infrastructure within the City of Vancouver”. The Mayor of White Rock has done something similar. Vancouver’s Mayor, the Mayor of Burnaby and the Chief of the Tsleil-Waututh First Nation are hosting an event in the near future aimed at rallying support to stop the proposed expansion of the Kinder Morgan pipeline. Then there are all the various groups and campaigns that seem to spring up around election time which seem to say “no” to just about everything and “yes” to things that cost a lot money (but without any ideas about how to pay for them, e.g., the proposal for a new subway along the Broadway Corridor recently advanced by the City of Vancouver and others).
LNG in a Shifting Global Context
As British Columbians begin to get familiar with the possibility of having a new LNG industry driving our natural gas sector, we would be wise to have a clear understanding of just how tough the competition is within this rapidly developing global sector.
The Different Faces of Government Debt in British Columbia
Last month’s provincial budget provides updated projections of the government debt that has built up over time in British Columbia. Some media reports on the budget referred to the “accumulated government deficits,” while other reports mentioned the “tax-supported debt” or the “total provincial debt.” What do these different debt-related terms actually mean?
Does Business Care about the Environment??
Yes business people do, absolutely. Where did the view that they don’t’ come from anyway?
Business people live in communities. They are your neighbours, your family, your friends, and maybe even you. You buy things and services from them, you eat and you debate with them over the dinner table, you talk over the fence with them. These aren't people or entities removed from who we are or monsters under the bed.
They aren't strangers.
Often they are entrepreneurs who have seen an opportunity and found a way to supply the rest of us with the goods and services we need and demand, to create jobs and to contribute to the economy of BC and Canada.
Job Growth in BC over the Past Decade: Mining Takes Top Spot
Want more jobs in BC? Then support the mining industry.
A review of job growth by detailed industry categories reveals that Mining has seen the strongest percentage job gains of any industry in the province. Over the past decade, the number of people working directly in Mining soared by almost 230%. The second fastest pace of job growth (187%) occurred in the industry that provides Support Activities for Mining and Oil and Gas, things such as drilling and exploration services.
Why Tax Competitiveness Matters
British Columbia is a small, open trading jurisdiction that relies heavily on natural resource exports to fuel the economy. While our economy continues to diversify (and that is a good thing) into more service oriented sectors, the core driver of the economy remains our exports, and natural-resource based products represent 70-75% of the province’s international merchandise export shipments. These exports, together with our strategic location and high quality of human capital, have combined to create a high standard of living.
In order to realize the theoretical benefits of these resources, there is also a need for sound public policies that enable development through effective planning, infrastructure development and tax/regulatory structures that attracts private sector investment. On this latter point, British Columbia’s historical track record is mixed, with significant improvements occurring in recent years that have helped to stimulate a lot of activity on the land base.
Five Things You Should Know about BC Budget 2013
1. The BC government’s operating deficit for this year is estimated at $1.2 billion, less than 3% of the pan-Canadian deficits from the national and all provincial jurisdictions
2. BC’s net debt equals 17% of GDP, the third lowest debt-to-GDP ratio in the country
3. According to Budget 2013, the BC government intends to limit the growth of program spending to just 1.5% per year over the next three years.
4. Capital spending is expected to fall from $6.8 billion this year to $6.2 billion in both 2013-14 and 2014-15.
5. Despite a one percent increase in the general corporate income tax rate (CIT), BC will continue to have a competitive CIT compared to other North American jurisdictions – however, the timing of this increase poses a risk for our overall competitiveness
Understanding the Limitations of Tax Increases – A Critique of CCPA’s Plea for Big Tax Increases on BC Businesses and Households
Recently, the Canadian Centre for Policy Alternatives (CCPA), a prominent union-backed Canadian think tank, released a study entitled “Progressive Tax Options for BC”. The basic premise of the study is that there is both a serious need and a significant desire among BC citizens for sizable tax increases to fund more services and re-distribute wealth to address inequality. In their words, BC has “plenty of room” to raise taxes. While this has been a common refrain from the CCPA for some time, this position is now backed with further research and the results of an on-line survey.
Metro Vancouver needs Regional Economic Development Strategy
In today’s global economy, the competition for talent, investment and high-value business activity increasingly is playing out at the metropolitan level. Indeed, urban regions are looming ever larger in the world economy. According to the Brooking Institution’s Global Metro Monitor, the 300 biggest cities and metro areas account for almost half of global gross domestic product, despite being home to only one-fifth of the world’s population.