B.C. voters have spoken and while some ballots remain to be counted, the outcome is clear. Congratulations to Premier-elect John Horgan and his colleagues on securing a majority government and thank you to all who put their name forward for public office.
Throughout the campaign, commitments were made by all parties to improve the lives of British Columbians with new measures promised in areas including health care, child care and housing — as well as continue to provide continuing support in the fight against COVID-19.
These social supports and programs are vital to many, particularly amid this pandemic, as we manage our personal and financial health. However, the election campaign saw little attention given to how to provide and enrich social supports in a sustainable way, nor to the key economic challenges facing B.C. over the medium term.
The reality is that the pandemic has led to dramatically higher government deficits all over the world. In B.C., much of our deficit reflects a massive drop in revenue owing to a constrained and battered private sector. While deficits will need to continue to provide significant financial support to get British Columbians through the next couple of years, creating revenue through economic growth and opportunity will be essential to maintaining the supports and programs that voters want.
Simply put, governments must turn to fostering the conditions for private sector businesses to invest, innovate, grow and create jobs for B.C. families, which combined drive government revenues. This means focusing on policies and opportunities that expand the economic pie rather than quarrelling about how to carve up a shrinking one.
A knee-jerk solution is to raise taxes. B.C. and much of Canada have little room left within households or across the private sector to shoulder larger tax burdens. Innovators and job generators in B.C. already pay 54-per-cent marginal tax rates on their incomes. Statutory tax rates on business income have risen since 2012, and B.C. businesses face average combined taxes on new investments that are among the highest in all advanced economies. In a competitive world where firms can live, invest and operate a business from anywhere, punitive tax policies will not serve the province well.
So, thinking about how we create a growing, innovative economy for a rapidly changing and more competitive future must be a priority for the re-elected government. Without that, little can be done to improve social supports for families and governments will struggle to maintain services.
Today, we’re confronted by the most uncertain and challenging economic circumstance in my lifetime. As jurisdictions around the world compete for every available dollar of investment, we must be open to bold steps to ensure B.C. is an attractive option in which to place scarce capital and develop and commercialize ideas, products and technologies in a digital and lower-carbon world.
The Business Council is committed to working with the new government to identify opportunities and policies that will enable a strong economy that supports British Columbians’ well-being and advances our collective prosperity.
Streamlining regulation, enabling B.C.’s export industries to thrive, improving government processes through the adoption of technology, modernizing the tax system, expanding child care, investing in rapid re-skilling, establishing innovation precincts, leveraging the province’s low-carbon advantage and creating an Indigenous Economic Development Centre of Excellence are among the suggestions we have made to the government.
We trust in the doctors, medical professionals and public health officials to guide us through this pandemic. But future generations depend on all of us, including business, government and Indigenous leaders, to work together to build a stronger tomorrow, starting today that sets us on a path to a private-sector-led, job rich recovery. Now is the time to act with purpose together.
Greg D’Avignon is President and CEO of the Business Council of B.C.
As published in the Vancouver Sun.