B.C.’s economy is in relatively good shape compared to other provinces as the NDP government prepares for a year where the COVID-19 pandemic is easing, the B.C. Business Council says in a pre-budget analysis.
But the tax environment is affecting competitiveness, working against the provincial government’s push to move B.C. to a more high-tech economy with hundreds of millions in innovation, clean energy and skills training spending ahead.
Finance Minister Selina Robinson is preparing to release B.C.’s 2022-23 budget on Feb. 22. A forecast deficit for the current year has shrunk from nearly $10 billion to $1.7 billion, including large contingency funds, but much of that is likely to be expended this year on massive reconstruction of flood-damaged highways and recovery of Lytton, Merritt and the Eastern Fraser Valley.
The skills shortage is significant, particularly in senior management roles where top executives are faced with an personal income tax rate of more than 53 per cent, BCBC chief economist Ken Peacock said Friday. And B.C. competes with the U.S. Pacific Northwest, where Washington has no state income tax, as it hopes for more investment from technology giants such as Amazon and Microsoft.