BC United promises huge provincial income tax cut, raising exemption to $50,000

VICTORIA — British Columbia’s Opposition is promising the largest income tax cut in the province’s history if elected this fall, prompting Premier David Eby to call the pledge “extreme” and “radical” and a recipe for service cuts.

The BC United plan would raise the earnings threshold for provincial income tax to $50,000, up from the current $11,980.

Leader Kevin Falcon said the “bold” plan would allow taxpayers to keep an additional $2,050 on average and result in 60 per cent of B.C. residents, or more than 2.4 million people, being exempt from provincial income tax.

Falcon acknowledged annual government revenue would drop by $5.4 billion, but said service cuts would not be necessary as increases in private sector investments and consumer spending confidence would take up the slack.

“And, no services do not have to be cut,” he said at a news conference on Tuesday. “This is one of the great myths of the left. The NDP will tell you that all of their spending is actually really important. I would argue they’ve got it wrong.”

Falcon said the tax cut would benefit many elderly people on fixed incomes and families struggling with the high costs of living.

A person earning $35,000 a year on a minimum-wage salary would pay no provincial income tax, saving about $1,134, he said, while a person making $50,000 or more would save $2,052.

“I believe that bold public policy still matters,” Falcon said. “Today is just part of the bold public policy agenda we have.”

Eby said affordability is an issue people face in B.C., but “what Mr. Falcon has proposed is quite an extreme and radical proposal that would require cuts to the provincial budget of at least $5 billion.”

Falcon also pledged to balance the province’s budget — which currently involves a deficit of $5.9 billion, with a projected deficit of $7.9 billion next year — within the first term of a BC United government.

“Here’s what that means,” said Eby at an unrelated news conference in Penticton. “It means fewer schools, fewer teachers, fewer new schools, any new hospital expansions being cancelled. I think he is truly revealing who he is, which is someone even to the right of (B.C. Conservative Leader) John Rustad when it comes to cutting public services in service to a particular ideology.”

B.C. Green Leader Sonia Furstenau said Falcon’s promise to implement the tax cut and balance the budget could result in more than $12 billion in cuts.

“BC United’s plan will not help our province thrive, it will only gut our budget when our health-care system is already in crisis,” she said in a statement. “The business community knows that without a healthy workforce and reliable government services, the economy can’t succeed.”

Furstenau said the former B.C. Liberals, now known as BC United, slashed social services in the early 2000s after introducing income tax cuts shortly after forming government.

Falcon brushed aside questions about his party’s recent standing in public opinion polls that indicate BC United is well behind the NDP and B.C. Conservatives.

“I’ll just say the same thing about polls I always say about polls, whether they show us improving or not improving, they are meaningless,” he said. “I really believe this. People don’t plan their meals 60 days from now. They don’t plan how they’re voting 60 days from now.”

This report by The Canadian Press was first published Aug. 13, 2024.

Dirk Meissner, The Canadian Press