Harmac pulp mill near Nanaimo: forest products companies are major users of electricity.

Harmac pulp mill near Nanaimo: forest products companies are major users of electricity.

B.C. considers business sales tax relief

Finance Minister Mike de Jong considers giving up $160 million in provincial sales tax revenue added to business electricity bills

B.C. is the only place in North America that charges sales tax on business electricity bills, a cost the finance ministry is considering removing to help the struggling forest and mining industries.

The issue was identified in November when an expert panel on tax competitiveness reported back to Finance Minister Mike de Jong. It noted that the province takes in $160 million from provincial sales tax (PST) on electricity bills, part of a generally high-tax environment for business and investment in B.C. relative to the national average.

[See commission report below]

Last week, mayors of eight forest-dependent communities wrote to de Jong and Premier Christy Clark, asking for PST relief for lumber, pulp and paper producers in their communities.

“Communities in rural B.C. are not experiencing the same economic growth enjoyed in Lower Mainland communities,” wrote the mayors of North Cowichan, Quesnel, Vernon, Port Alberni, Mackenzie, Powell River, Taylor and Port Alice.

“Eliminating the PST on electricity for businesses is meaningful action you can take that would not only help the forestry industry and the jobs it supports, but will also benefit the mining industry and other energy-intensive job creators in our province.”

The finance ministry issued a statement Tuesday acknowledging that de Jong is “considering this proposal along with many other spending priorities as we prepare the upcoming provincial balanced budget and longer-term fiscal plan.”

Energy Minister Bill Bennett said the issue has come up over the years, but the Commission on Tax Competitiveness report has created a “unified focus” among groups including the B.C. Business Council, the B.C. Chamber of Commerce, the Vancouver Board of Trade as well as mining and forestry associations.

It would be a cabinet decision that would only be revealed when de Jong tables the provincial budget Feb. 21.

“Taking PST off the purchase of electricity would help pulp mills, would help the sawmills, would help the mines,” Bennett said Wednesday. “It would help small business, and B.C. is one of the only, if not the only jurisdiction that charges sales tax on purchase of electricity.”

The commission found that B.C.’s PST is an impediment to investment in machinery and equipment, which it found to be the third lowest of any Canadian province.

CommissionOnTaxCompetitiveness Nov 2016 by Tom Fletcher on Scribd

Kelowna Capital News

Just Posted

With high temperatures forecasted for the week and into the next, Interior Health is offering some tips on how to keep yourself safe from heat-related illness. (Pixabay)
Interior Health offers safety tips as temperatures soar

“Too much health can be harmful to your health.”

Central Okanagan Public Schools (File photo)
COVID-19 exposure identified at West Kelowna school

The site of the exposure has been identified as Shannon Lake Elementary School

A West Kelowna man was seriously injured in a single-vehicle collision early on Tuesday morning. (Black Press file photo)
Single vehicle collision seriously injures West Kelowna man

The man was driving a pickup truck that went off the road and caught on fire

(Pixabay photo)
Morning Start: Cheetahs can’t roar

Your morning start for Tuesday, June 22, 2021

Voix du Coeur is bringing music to seniors in retirement homes as restrictions slowly start to ease. (Twila Amato/Black Press Media)
Trio sings opera to Okanagan seniors as pandemic restrictions ease

Voix du Coeur travel around the Okanagan to bring the joy of music to seniors for free

Teenagers make their way to Truswell Road after a party is broken up by police at the end of Mission Creek (Lorraine Besner/Contributed).
Kelowna residents concerned about ongoing alleged underage beach parties

Public urination, property damage, drinking and drug usage have become weekly concerns

People enjoy the sun at Woodbine Beach on June 19, 2018. THE CANADIAN PRESS/ Tijana Martin
BC Hydro assures customers it has ‘more than enough’ power to weather the heatwave

Despite an increase of pressure on the Western grid, blackouts are not expected like in some U.S. states

Air Canada planes sit on the tarmac at Pearson International Airport during the COVID-19 pandemic in Toronto on Wednesday, April 28, 2021. THE CANADIAN PRESS/Nathan Denette
Pilots say no reason to continue quarantines for vaccinated international travellers

Prime minister says Canada still trying to limit number of incoming tourists

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Six United Way chapters around the province are merging into United Way B.C. (News Bulletin file photo)
6 United Way chapters merging around B.C.

Money raised in communities will stay in those communities, agency says

Val Litwin is the latest candidate to declare his bid for the B.C. Liberal leadership. (Litwin campaign video)
Political newcomer joins contest for B.C. Liberal leadership

Val Litwin a former B.C. Chamber of Commerce CEO

A new air cleaning technology will be installed at Unisus School in Summerland. (John Arendt - Summerland Review)
Virus cleaning pilot set for Unisus School in Summerland

Summerland-based lighting company to install technology at private school

Golden Ears Mountains, captured in May 2021. (Black Press Media files)
2nd year of day passes required for entry into 5 provincial parks launches in B.C.

Pilot program seeks to protect the environment by addressing visitor surges amid the COVID-19 pandemic

Lincoln Mckoen. (YouTube)
Anglican bishop of the central Interior resigns over sexual misconduct allegations

Lincoln Mckoen was elected as a bishop of the Territory of the People region last year

Most Read