Although the 2014 provincial budget is balanced, Finance Minister Mike de Jong is still pulling a controversial yearly dividend out of ICBC to help stave off the red ink.
The annual transfer from the public auto insurer’s optional insurance profits to the province is expected to be $200 million in 2014, $155 million in 2015 and $125 million in 2016, according to budget documents.
Critics have long denounced the transfers as an inappropriate raid on ICBC profits and say motorists should get any dividends – in the form of lower rates.
“For too long government has been addicted to the ICBC revenues and has conveniently forgotten that drivers and taxpayers are not the same people,” said Jordan Bateman of the Canadian Taxpayers Federation.
“They’re taking money from drivers and giving the benefits to all people, which is unfair.”
The annual transfers are down from $576 million in 2010 – when they began – and were expected to be $237 million for the 2013 fiscal year.
Bateman said the CTF had called on the province to wean itself off the ICBC dividends over 10 years and said it looks like that’s starting to happen.
“It would be great to see them get off the ICBC dole tomorrow but that would blow the budget contingency fund out the door,” he conceded.
First-time home buyers are in line for some tax relief from the budget.
The threshold at which they must pay B.C.’s Property Transfer Tax was raised from $425,000 to $475,000. Realtors lobbied for the change, which provides a break of up to $7,500 on the purchase of a new home for those eligible.
At the same time, the province reduced the threshold for the phase-out of the homeowner grant to $1.1 million, meaning owners of homes worth more than that may pay higher property tax bills.