Finance Minister Carole James describes B.C.’s slowing growth projections as interest rates begin to rise, presenting her first budget update, Victoria, Sept. 11, 2017. (Tom Fletcher/Black Press)

B.C. VIEWS: Plucking the golden goose

B.C. NDP, federal Liberals raise high-earner income tax to 50%

“The art of taxation consists in so plucking the goose as to procure the largest quantity of feathers with the least possible amount of hissing.”

These are the famous words of Jean-Baptiste Colbert, finance minister of France from 1665 to 1683, and they endure to this day in British Columbia.

And now this plucking duty falls to Finance Minister Carole James, who brought a relatively delicate hand to her first round of goose down extraction, the September budget update.

It was mostly an execution of well-known election promises, with familiar political spin. What the NDP tirelessly described as the “tax break for the richest one per cent” is finally over after two agonizing years of giveaways to B.C. Liberal donors.

In fact, James increased the tax rate by two points on personal income over $150,000 a year, bringing that rate from 14.7 per cent to 16.8. This restores a top bracket introduced for two years as the B.C. Liberals campaigned for the 2013 election amidst recession and an HST hangover. And these are not the top one per cent of earners, but more like the top five.

And of course this is the Canada goose, where the federal government is preparing its own somewhat rougher round of plucking. There is hissing and honking across the land as Ottawa moves to tax personal corporations, with doctors and other self-employed entrepreneurs loudly protesting that their feathers are about to be yanked out by the handful.

Some may fly south and never return, a chronic problem in Canada. Why? This restored B.C. tax on rich doctors, lawyers, tech wizards, and yes, plumbers and carpenters, is on top of a recent four per cent increase in the highest federal income tax rate.

For these high flyers in B.C., tax will now confiscate half of their income, a level noticed by even the toughest of geese.

“Moreover,” say Fraser Institute economists, “B.C. will have a higher top tax rate than next-door Alberta (48 per cent) and much higher than next-door Washington, which has no state-level income tax.” So if you’re a goose flying over Amazon headquarters in Seattle or Microsoft’s home office in Redmond, the top U.S. federal rate is approximately 40 per cent and kicks in at a much higher income level.

Some readers may recall when then-NDP leader Carole James led an “axe the gas tax” campaign against B.C.’s carbon tax. Now as B.C.’s first NDP finance minister since Ujjal Dosanjh appointed Paul Ramsey to the job in 2000, James has got religion on saving the planet.

B.C.’s carbon tax on fuels goes up 17 per cent next April 1, and the next two Aprils after that. This is earlier than the NDP planned, at the behest of the three B.C. Greens, who made it a condition of propping up the second-place party in the 2017 election.

This puts B.C. a year ahead of the carbon pricing mandate forced on all provinces by Prime Minister Justin Trudeau. The sneaky NDP pluck here is ending “revenue neutrality,” meaning future carbon tax increases will no longer be offset by reductions in personal and business income tax. You’ll never know those feathers are gone, except for a slight twinge when you gas up the car.

B.C.’s corporate income tax goes up one point to 12 per cent, another populist NDP promise to make those corporations pay. That will be on top of Ottawa’s next feather-gathering move to try to stop the endless string of big-spending deficits introduced by Trudeau and his finance minister Bill Morneau.

Tom Fletcher is B.C. legislature reporter and columnist for Black Press.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Current forest fires bring back memories of 2003 wildfire in Kelowna

Former Kelowna fire chief says plan should be to throw everything at a forest fire early

Cooler temps today, but no rain in forecast until August

Environment Canada does not have good news when it comes to fighting fires in the Central Okanagan.

Updated: Firefighters attacking Mt. Eneas Wildfire near Peachland from north and south

Crews continue to battle the 1,000 hectare Mount Eneas blaze south of Peachland

Updated: Complete list of B.C. Interior wildfire coverage

Up-to-date information on blazes happening the Kamloops Wildfire Centre

Fire command centre relocating from Penticton to West Kelowna

Firefighting resources to be concentrated out of temporary camp

Live: BC Wildfire Service press conference

Watch the LIVE media briefing on the current fire situation in the Okanagan.

Matjicka pulls trick for Silver Stars

Capri Insurance Men’s 55+ Soccer League roundup

Crosswalk vandalism leaves black mark for Cowichan as B.C. Games begin

Rainbow crosswalk defaced just days after being painted

Photo gallery: BC Games Day 1

A brief look at action from the 2018 BC Summer Games in the Cowichan Valley

More space in BC parks and campsites to get away from it all

Province announces an additional 431 campsites throughout B.C. for the 2018 season

Anti-pipeline campers digging in as eviction deadline expires

The City of Burnaby had ordered the Kinder Morgan pipeline protesters out for violating bylaws

Garnet Valley Road in Summerland blocked as crews fight wildfire

Homes in Summerland from Wildhorse Road north have been evacuated as Mount Eneas fire continues

Trump was taped talking of paying Playboy model: AP source

Source says former personal lawyer Michael Cohen secretly recorded discussion prior to 2016 election

BC toddler with ‘allergy’ to sun waiting for bone marrow transplant

Charlie Lock, 2, needs treatment for damage caused by rare disorder EPP

Most Read