BCBC In The News
Maple Ridge - Pitt Meadows News: B.C.’s budget update has its fans and foes
[Excerpt] The Business Council of B.C. though says in a release that it appreciated the steps taken to address cost of living in the province, but the council is concerned about added costs for employers who pay the wages. It also noted that the yearly forecast budget surpluses are smaller than left by the Liberals in 2016-17. It said the government has to be careful about “hardwiring” new spending increases into its budget.
Vancouver Sun: B.C. tax hikes won't take big bite out of economy, economists say
Tax hikes for the wealthy and on corporations introduced in Finance Minister Carole James’ budget update Monday are unlikely to put an immediate dent in the economy but could dampen future investment, according to economists.
For businesses, the one per cent increase is expected to generate an additional $103 million in its first partial year from January to the end of March of 2018, then $313 million in its first full year.
But the rate will still be competitive with surrounding jurisdictions, said Jock Finlayson, executive vice-president and chief policy officer for the Business Council of B.C.
“Having said that, economists would be unanimous, I think, in saying that higher effective tax rates on earnings, almost by definition, have a negative effect on capital formation and investment,” Finlayson said.
That means in a higher tax environment, businesses need to earn a higher profit to justify additional investment in that location, he said, which is where a longer-term impact might come out of B.C.’s business tax change.
The promise to cut Medical Service Plan premiums in half, then eliminate them, has a significant positive impact on companies that pay those costs, Finlayson said. The $5-per-tonne increase to the provincial carbon tax, however, is negative.
Finlayson said the increase to the top marginal personal income tax rate for people earning more than $150,000 per year might be a bigger concern, since it is combined with the four per cent increase added to the federal top marginal tax rate for those earning more than $250,000 enacted in 2016.
The Globe and Mail: B.C. economy forecast to grow faster than expected this year
[Excerpt] Jock Finlayson, chief policy officer at the Business Council of British Columbia, said the NDP government will not be able to count on strength in consumer spending for much longer. "Looking ahead, we need to see a pickup in business investment and further gains in exports in order to achieve a healthier and more balanced economic growth profile in B.C.," Mr. Finlayson said in a statement.
Business in Vancouver: NDP budget update raises spending by $2.7 billion
[Excerpt] The budget update got mixed reviews from B.C.'s business leaders. The BC Chamber of Commerce gave the NDP government credit for sticking to a balanced budget, while the Business Council of B.C. (BCBC) voiced concerns that the budget is being balanced by increasing costs for business.
"We appreciate that the new government is taking steps to deliver on some needed commitments to improve affordability and address the cost of living pressures facing many BC families," said BCBC CEO Greg D'Avignon. "That said, we are concerned about the added costs being imposed on employers and the business sector generally who ultimately support and create the high wage jobs and investments that enable trade, and support prosperity for both the kitchen and boardroom tables."
Vancouver Sun: B.C. budget: Tax hike for wealthy, more money for education, housing, overdose crisis
[Excerpt] Jock Finlayson, executive vice-president of the B.C. Business Council said there were no major surprises, based upon the NDP’s election platform. “That in itself is good news, we often worry about going into budgets, especially with new governments, we often worry about being blindsided a bit. That didn’t happen,” he said.
The government’s overall projections for revenues, expenses and management of the public debt were reasonable, said Finlayson.
However, the increase to the corporate tax rate, carbon tax and the “hard-wiring into the budget various spending commitments” does give the business sector pause, because it increases the chance the government could go back into deficit in the future, he said.
Huffington Post: BC Budget 2017: Here Are The Winners And Losers
Corporate Businesses: The general corporate income tax rate will rise to 12 per cent from 11 per cent. Jock Finlayson, B.C. Business Council vice president, said the business Community expected the tax changes as they were part of the NDP's election platform, but "this budget isn't going to create a lot of new investment."
BNN: B.C. budget funds 3,500 teachers, homes for homeless; hikes taxes on rich
[Excerpt] Jock Finlayson, B.C. Business Council vice president, said the business community expected the tax changes as they were part of the NDP's election platform, but "this budget isn't going to create a lot of new investment."
He said the increase in personal income tax, coupled with federal government tax changes, could result in B.C. businesses not being able to attract top-job candidates.
Global News BC: B.C. budget: 7 things that gave business advocates some pause
[Excerpt] Doing business in B.C. is not cheap, if you ask the B.C. Business Council.
In a news release, chief policy officer Jock Finlayson said that the cost of doing business in B.C. has grown by approximately $3 billion in the past three or four years, and the latest budget update doesn’t help with that.
The increased cost of doing business has come about due to a number of factors, including “higher electricity prices, the return of the PST, increased and more complex regulatory requirements and other trends.”
The budget update exacerbated that cost through higher corporate and income taxes, he said.
BIV VIDEO: What does the NDP budget mean for B.C. Business
Jock Finlayson of the Business Council of B.C. discusses the B.C. NDP budget update and what it means for businesses in the province.
Times Colonist: Small business gets tax cut, corporate rates rise
Corporate income tax rates are rising and there’s a tax break for small business in B.C.’s budget update, but overshadowing the new government’s balanced books is the spectre of global uncertainty, particularly with our southern neighbour.
No major surprises were revealed in Monday’s budget update, “which is good,” said Jock Finlayson, executive vice-president of the Business Council of B.C. “The overall fiscal framework — total spending, total revenue, budget surpluses, management of the debt-to-GDP ratio — I would say is reasonable overall.”
The Business Council does not favour that decrease, saying B.C. already has some of the lower rates in the country.
If a business’s profit is below $500,000, it pays two per cent. One dollar more and it pays 12 per cent, Finlayson said. “At the margin, it is actually a disincentive to growth, which is an odd thing for the tax system to do.”
Litwin and Finlayson both support the government’s two-year phase-out of provincial sales tax on electricity for business.
Budget documents show that the first part of the phase-out will mean $21 million less to the province in 2017-2018, and $82 million in subsequent year.
This move will help industries that are intensive users of electricity, such as pulp and paper, manufacturing, metal fabrication, and food processing, Finlayson said.
Times Colonist: NDP budget hikes taxes on rich to pay for social spending
[Excerpt] Jock Finlayson of the B.C. Business Council called the government’s fiscal plan “reasonable” and said the promised tax hikes came as no surprise. “We do have concerns about the cumulative effect of higher corporate income taxes, four years of fairly steep increases in the carbon tax in tandem with ongoing upward pressure on the cost of electricity, plus what’s happening at the federal level where various costs are going up, too,” he said.
“So that is a concern and it’s not something B.C. can solve in one budget, but it’s something they really need to pay more attention to.”
The Globe and Mail: B.C. NDP’s first budget begins remake of province but puts off most expensive promises
[Excerpt] Jock Finlayson, chief policy officer for the Business Council of B.C., applauded the NDP's cautious economic forecasting.
"Overall, the fiscal framework is reasonable," said Mr. Finlayson, who acknowledged the government's approach will mean more spending and could eventually lead to deficits.
"This government is committed to a more activist approach."
BIV on Roundhouse August 25: Trump keeps NAFTA talks lively
The Business Council of B.C.’s chief policy officer, Jock Finlayson, discusses Canada’s sub-par trade performance. [14:30]
Vancouver Sun: B.C. government posts massive but likely unsustainable surplus
[Excerpt] “This surplus could disappear almost in the blink of an eye,” said Jock Finlayson, executive vice-president of the B.C. Business Council. “The economy will probably slow, not because of the government but because it’s growing over potential.”
“Some of this revenue strength is reflecting non-sustainable surges in particular revenue line items. Obviously prior year tax adjustments are one-offs and I agree the higher property transfer tax revenue is not something we can bank on going forward,” said Finlayson.
“This $2.7 billion operating surplus on a $50 billion budget is good news but could disappear very quickly. And my prediction is it will. This is sort of the high water mark from a surplus point of view and we do expect the economy to slow down, not to go into recession or anything but growth will cool off a bit. And housing will slow as mortgage rates rise and perhaps other actions are taken to deal with speculation.”
Business in Vancouver: Industry leaders tackle corporate culture gap
[Excerpt] Greg D’Avignon, president and CEO of the Business Council of British Columbia, also heads HQ Vancouver, a joint federal-provincial initiative to draw more overseas companies to set up regional headquarters in B.C. He said the difficulty isn’t isolated to the Chinese, noting that firms from other Asian markets also struggle to set down roots in the Lower Mainland. While Vancouver is the destination of many new immigrants who, after a short period of stay, want to bring their businesses to the city, the reality is that most do not enter the city with a business in mind and therefore may not be ready to jump in.
“We have a lot of people in the East and South Asian communities here in Vancouver, but much of the population here had moved with their families and aren’t investing capital or expanding businesses into the marketplace,” D’Avignon said. “There’s lots of untapped opportunity to put B.C. and Vancouver onto people’s lists of where to do business.… We are proud of ourselves as Vancouverites, but other people know very little about us – and that’s an important context.”
BIV on Roundhouse July 28: Will the NDP government be business-friendly?
On the latest show, the Business Council of B.C.’s chief policy officer Jock Finlayson shares some policy advice for B.C.’s new GreeNDP alliance. [00:40]
Times Colonist: Impact of new NDP government on businesses, workers unclear
[Excerpt] Premier John Horgan, who was sworn in Tuesday, and B.C. Green Party Leader Andrew Weaver have promised to stop Kinder Morgan’s $7.4-billion pipeline expansion and ask the province’s Utilities Commission to review B.C. Hydro’s $9-billion Site C dam project.
Greg D’Avignon, president of the Business Council of B.C., said the uncertainty around those projects could shake investor confidence.
D’Avignon said he has had conversations with members and international firms whose concerns “are no longer about a dam and a pipeline. They’re actually about whether people want to invest in B.C.”
BIV podcast (No. 73): Can B.C.'s housing sector handle a rate hike?
The Bank of Canada has finally handed down its long-awaited rate hike — so what does this mean for the economy?
Ken Peacock, chief economist at the Business Council of B.C., talks to hosts Tyler Orton and Hayley Woodin about what we can expect from everything from mortgage rates to exports.
Fairchild TV: Jock Finlayson on upcoming NAFTA renegotiation
Jock Finlayson, Executive Vice President and Chief Policy Officer, speaks with Fairchild TV reporter Nicole Ho about the recently released goals released by the United States in advance of the NAFTA renegotiation and potential impacts for the BC economy.
BIV on Roundhouse Radio: Ken Peacock
On the show, Ken Peacock, chief economist at the Business Council of B.C., discusses the Bank of Canada’s latest rate decision and why his organization is revising the province’s economic forecast upward. [Starts at 00:30]