B.C. NDP would raise $300 million through taxes
Published Thursday, April 11, 2013 3:00PM EDT
Last Updated Thursday, April 11, 2013 10:45PM EDT
VANCOUVER -- An expanded carbon tax would be in, while education savings grants and the early childhood strategy would be out if a New Democrat government is elected in British Columbia next month.
The NDP offered another peek at its fiscal plan on Thursday, outlining how it would raise revenues to pay for spending priorities without adding to what it says is a hidden Liberal deficit that will be inherited by the next government.
"What our commitment is ... is that our new spending would be matched by revenue. It isn't a reduction in spending, but it isn't an increase in spending either," NDP finance critic Bruce Ralston said at a Vancouver news conference.
"Our commitment is to spend within those limits, to be vigilant in observing those and keeping to those and to run as prudent and as economical a government operation as we can."
On the chopping block is the Liberal B.C. Training and Education Savings program.
Since 2007, the province has put aside $1,000 in a government-managed education savings fund for every child born in B.C.
Originally meant to provide about $2,200 for children for post-secondary schooling beginning in 2024, Premier Christy Clark announced in February that parents could have $1,200 deposited directly into a federal Registered Education Savings plan when the child turns six -- this year for some.
Cancelling the program would free up $30 million a year.
The early-years strategy announced in February included $76 million over three years for new childcare spaces and early childhood development programs.
And the early childhood tax benefit to begin April 1, 2015, would provide families with net incomes under $100,000 a year with $55 a month for each child under six.
The "repurposing" of the Liberal spending would add up to $86 million this year, $148 million in 2014-15 and $328 million in 2015-16, Ralston said.
"We're making, I think, difficult decisions in the sense that we're announcing tax increases now, before we announce our spending, not after the election," Ralston said. "I think those are difficult and challenging decisions and I think the public, frankly, will appreciate that."
The New Democrats would expand the carbon tax to included vented emissions from the oil and gas industry, worth an estimated $35 million when it takes effect next year and $100 million by 2016-17.
Ralston confirmed the New Democrats would not balance the carbon tax with tax reductions, a "revenue neutral" promise made by the Liberals.
NDP Leader Adrian Dix has already said his party would raise the corporate income tax and increase personal income tax for high-income earners.
The higher corporate tax would raise $100 million this fiscal year and $200 million the following two years.
The New Democrats would also implement a corporate capital tax on financial institutions -- three per cent for those based outside the province and one per cent for banks and credit unions headquartered within.
The entire plan would raise more than $300 million in the first year and by the third year, almost $1 billion.
The New Democrats say the next government will inherit an $800 million deficit, despite the Liberals' claim of a balanced budget. Ralston said deficit budgets would continue for the first three years of a four-year mandate.
Liberal Finance Minister Mike de Jong said the NDP plan is a recipe for a credit downgrade for the province.
He called the carbon tax expansion "an attack" on the oil and gas industry, and said the capital tax and the increase in taxes for high-income earners will drive people and business from B.C.
"What's clear from this document is that spending is going to go up under the NDP by between $4 and $5 billion. What isn't at all clear is how large a deficit they are prepared to run," said de Jong.
The NDP did not release details of their spending plans. Carole James, co-chairwoman of the NDP platform, said those details will be in the platform to be released next week.
"We are saying that we believe we can better use those dollars," James said.
Emily Mlieczko, executive director of the Early Childhood Educators of B.C., said the Liberal strategy will not necessarily be missed.
"We didn't feel that what was proposed really addressed the crisis in child care in our province," said Mlieczko, whose group wants $10-a-day childcare.
"This does help improve the fairness of the carbon tax, ensuring both industry and the households are part of the solution," Ian Bruce said, adding that the foundation would like to see increases in the tax over time.