BC Provincial Budget 2016

On February 16th, the BC government did the first reading of its 2016 provincial budget. As always, there is both good and bad news for BC residents, depending on their personal situations. Here are some of the highlights.

On the housing front– always of interest to Lower Mainland residents– there will be changes to the property transfer tax. A full exemption will apply for newly-built homes up to $750,000, with a partial exemption up to $800,000. The potential savings on these purchases? $13,000.

To fund the exemptions, the property transfer tax on the sales of properties above $2 million will increase from 2% to 3% on the portion of fair market value over $2 million.

In addition, the BC government plans to begin collecting data on individuals purchasing property here starting this summer. Purchasers will be required to disclose whether they are Canadian citizens or permanent residents; if they are neither, they will have to disclose their home country. Finance Minister Mike de Jong said that the government stopped collecting data specifically identifying foreign purchasers in 1998, but that they believe there is a legitimate need to resume that process.

Changes to the BC Medical Services Plan (MSP) mean that children will be exempt from MSP premiums effective January 1, 2017. Also, there will be enhanced premium assistance for lower income families, individuals and seniors. A couple of examples are:

• a single senior with a net income of $37,000 per year will save $324 per year
• a single parent with one child and a net income of $37,000 per year will save up to $1,056 per year

Still, for higher income individuals, the monthly MSP premium for an adult will increase from $75 to $78 per month next year.

The BC Training and Education Savings Program is also being expanded. In 2013, the program was initiated to provide a one-time grant of $1,200 to the RESPs of eligible BC children born on or after January 1, 2007. This program is being expanded to extend the program to children born on or after January 1, 2006.

Finally, this year’s budget establishes the BC Prosperity Fund with an initial commitment of $100 million from the forecast 2015-2016 surplus. The BC Prosperity fund is intended to help eliminate the province’s debt over time and make investments in areas like healthcare and education that will provide future benefits to BC.

For more on the budget, see http://bcbudget.gov.bc.ca/2016

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