Low unemployment, economic growth and the introduction of new taxes led the B.C. government to take in nearly $3 billion more than budgeted in the year ended in March.
Finance Minister Carole James released the province’s audited public accounts at the B.C. legislature Thursday, showing an operating surplus of $1.5 billion for the year, despite an increase in program spending of almost $2 billion in 2018-19 fiscal year. Taxation revenue alone rose $2.1 billion, and natural resources revenue also came in $695 million higher than expected in the 2018 budget, the first full year of the NDP minority government.
The employer health tax, introduced to replace Medical Services Plan premiums, took in $464 million, as the government continued to collect MSP revenues at half of the previous rate for the year. MSP is to be phased out at the end of 2019.
The speculation and vacancy tax imposed on properties in urban areas took in $115 million during the fiscal year.
The province’s auto insurance company, ICBC, lost $1.1 billion that year, with soaring accident claims that have prompted an overhaul of rates and injury payouts. James said the reforms are being phased in and while there is some improvement, she expects another loss in the current year before ICBC covers its costs.
“When I say a slight improvement, I mean they lost less than expected, but they still lost,” James said.
— Tom Fletcher (@tomfletcherbc) July 18, 2019
Natural resource revenue was $695 million higher than budget, much of it stumpage income from Crown forests. A record summer for forest fire area also pushed protection spending $354 million above the budgeted amount.
Health and education spending exceeded budget by $688 million, much of that from more than 3,000 additional teachers added to satisfy an order of the Supreme Court of Canada.
B.C.’s economic growth for calendar 2018 is estimated at 2.4 per cent, third highest among provinces. The finance ministry says that growth was “led by goods-producing industries with notable gains in mining, quarrying and oil and gas extraction, construction and manufacturing.”