B.C. families are paying more in income tax as the province continues to deal with the fallout from the worst wildfires in Canadian history.
The Liberals have also slashed taxes for some low- and middle-income earners, and will increase the personal income tax rate by 20 per cent in 2019 to help pay for health care and other social programs.
And while it’s unclear exactly how much the new $1,500 tax credit will cost families, the NDP is proposing it would be worth the extra $1.5 million in tax revenue over 10 years.
The Liberal government’s new tax credit program, which was unveiled last week, is a significant change from the Liberal plan to create a new provincial social housing program.
“There is no question in my mind that the new social housing tax credit is the right thing to do,” NDP Leader Andrew Weaver said at the announcement.
It is a good thing.””
It is not a bad thing.
It is a good thing.”
In the first year, the tax credit would be available to families with incomes of $75,000, $150,000 or $200,000.
The new program would also give a tax credit of $1 per $100 of gross income for all families.
A tax credit worth $1 would amount to about $1 million over 10, 10-year terms, or about $10,000 per year, depending on household size, according to a budget summary released Monday.
The NDP estimates that the $1 tax credit for each $100 earned would bring in $2.3 billion in tax revenues over the next 10 years, and that it could pay for about $20 billion in social housing over the same period.
The government estimates that a $1 credit would provide $2,500 for every family of three in B.S. for an average of $25,000 a year.
The program is designed to help families who cannot afford to buy their own home, and who would like to qualify for assistance from the province to help with their housing costs.
The tax credit could be used to help offset the cost of a down payment on a home, or for a downpayment on a new home, the government said.
“We’re trying to get families on a level playing field so they can be better off financially, so we’re going to be able to provide the kind of help that’s going to help them be better, better off and we’re not going to see a tax increase for the middle-class,” said Weaver.
“The NDP has taken a very progressive approach to dealing with housing and we think that’s what the best way to get to a middle-wage economy is to give families the kind, the right kind of support and help them buy a home.”
The NDP also says the new program will help the province get out of the debt crisis, as well as the provincial government.
The province’s debt is now $22.8 billion, with $1 billion in outstanding principal and interest.
The budget summary estimates the province will need to borrow $6.5 billion in 2019, which is nearly $2 billion more than it expects to need to avoid defaulting on its debt.
The Finance Ministry has forecast it will need $3.5bn in 2019 and will need another $1bn to cover the remaining $7.5-billion debt in 2020.
The B.L.C.-based Liberals have announced that they will not raise taxes on the middle classes, instead focusing on improving the province’s finances by focusing on the needs of families.
The provincial Liberals also said they are working with the federal government to improve the province with a focus on infrastructure, health care, education, housing and other programs.
The finance ministry says it expects the new tax credits to have a major impact on B.N.T.F. households, which are the biggest part of the province population.
The tax credits are set to be rolled out over the coming years, starting with the 2019-20 fiscal year, when the province anticipates the program will be fully operational.