BC Budget 2017
September 21, 2018
This week the BC NDP released an update to their 2017 budget. We wanted to provide a quick summary of some of the changes announced, which we believe are most impactful to you. We also included some items of interest. This is by no means an exhaustive summary.
REDUCTION IN MSP PREMIUMS
Starting January 2018, MSP premiums will be lowered by 50% for all British Columbians as long as your net adjusted family income for the previous tax year is below $120,000. (See table below of estimated monthly premiums for 2018)
Also important to note that the threshold for having to pay any MSP premiums has increased by $2,000, up to $26,000. This means that if your adjusted family income is $26,000 or lower, you will not be required to pay MSP premiums.
The BC NDP has indicated that you do not need to apply for these reductions in premiums, they will be applied automatically at the beginning of 2018.
The BC NDP has also indicated their intention to completely eliminate MSP premiums within 4 years.
INCREASE IN SOCIAL ASSISTANCE
Social and disability payments will be increasing by $100 per month.
0.5% reduction in the small business corporate income tax rate from 2.5% down to 2%, effective April 2017. This was previously announced in the Liberal 2017 budget and will remain in force.
1% increase in general corporate income tax rate, from 11% up to 12%, effective January 2018. This will also increase the tax rate on passive income earned within a corporation by 1%.
2.1% increase in personal income tax, from 14.7% up to 16.8%, applied to taxable income over $150,000. This is a new tax bracket effective Jan 2018.
Child Arts, Child Fitness, and Child Fitness Equipment Tax Credits will be eliminated effective 2018.
The Liberal 2017 Budget indicated the Education Tax Credit was to be eliminated for 2018 and subsequent years, however we received no update on this from the NDP budget, so we have no updates on this.
$681 million increase in spending over 3 years to support the Kindergarten to Grade 12 education system.
$322 million to provide an immediate and evidence-based response to the fentanyl emergency.
The NDP government’s first budget looks to put in place some of the initiatives on which they campaigned while maintaining aspect of the Liberal budget. We will have further clarity in February, when the NDP will deliver their own budget.
Please reach out to us if you have any questions.
Joe Basque, BA, CFP® | Financial Planner & Investment Advisor
HollisWealth® a division of Industrial Alliance Securities Inc.
This information has been prepared by Lorenzo Pederzani and Matthew Evans who are Investment Advisors/Portfolio Managers for HollisWealth® and does not necessarily reflect the opinion of HollisWealth. The information contained in this newsletter comes from sources we believe reliable, but we cannot guarantee its accuracy or reliability. The opinions expressed are based on an analysis and interpretation dating from the date of publication and are subject to change without notice. Furthermore, they do not constitute an offer or solicitation to buy or sell any of the securities mentioned. The information contained herein may not apply to all types of investors. The Investment Advisors/Portfolio Managers can open accounts only in the provinces in which they are registered.
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