BC Finance Minister Carole James has released BC’s fiscal update for 2017/18. The budget previously projected a $1.85 billion surplus for 2017/18. The latest update forecasts a $7.37 billion deficit for 2018/19 – an improvement from a deficit of $10.1 billion for 2017/18.
The full 2018/19 budget update release and timeline can be found in BC Treasury Board’s website here.
B.C.’s fiscal update also forecasts an EBITDA of $1.67 billion for 2018/19 – up $138 million over the last fiscal update.
One key change to BC’s fiscal update – the fiscal note was revised slightly downward for flood and mudslide claims. The total costs of the disaster from 2016/17 has decreased from $4.5 billion to $4.2 billion, with $1.08 billion expected to be paid in 2018/19.
Just prior to the provincial budget, the new John Fraser Director of Insurance Services gave an updated total damages and losses estimate. The new estimate put total damage at over $3.1 billion, an increase from $2.5 billion reported in June.
The Province has also officially started the assessment phase of the devastating Salmon Arm Mudslide, which hit on June 23. The official assessment phase of this disaster began on July 4th.
B.C.’s tax revenues were also revised slightly higher – $54 million higher than projected in the fiscal update in June – an improvement of 0.6%. The estimates for corporate and personal income taxes, BC pension income and provincial land transfer tax receipts are higher than previously forecast in the fiscal update released in June.
After accounting for an increase in refundable taxes paid by BC residents, the fiscal update forecasts a net decrease in revenues, or a $4 million surplus in 2018/19. BC’s new tax rates have been in effect since July 1, 2018, with increased exemptions and lower income tax rates.
The budgetary projections for revenues, and operating and capital expenditures both remain the same as they were in the June budgetary projections. A summary of BC’s new tax rates can be found here.
BC’s current economic outlook has continued to improve since the April budget – unemployment remains below the national average and GDP growth is on track to be around 2%. This positive economic outlook indicates that BC has room to invest in important infrastructure and services.
For the latest on B.C.’s business environment and issues affecting businesses in BC, visit the BC Business Council’s website.