Written by Charlotte Teal, Ed Kroft and Sharon Singh
On March 23, 2020, British Columbia introduced a range of measures aimed at helping both the public and businesses cope with the economic implications of COVID-19. The Province of British Columbia announced its $5-billion COVID-19 Action Plan, which will provide $2.8 billion support to individuals and services, and $2.2 billion to support businesses and economic recovery.
Overview of the Plan
The Plan includes measures aimed at easing the impacts of COVID-19 on individuals and businesses.
Key measures aimed at businesses include:
- Deferring employer health tax payments for businesses with a payroll over $500,000 until September 30, 2020.
- Extending of the following tax filing and payment deadlines to September 30, 2020:
- Provincial Sales Tax (PST);
- Municipal and regional district tax on short-term accommodation;
- Tobacco tax;
- Motor fuel tax; and
- Carbon tax.
- Postponing certain tax changes previously announced in Budget 2020 until further notice, including expanded registration requirements for Canadian sellers of goods and Canadian and foreign sellers of software and telecommunication services, and the elimination of a PST exemption on sweetened carbonated drinks.
- Freezing the BC Carbon Tax rates at their current levels and postponing the alignment of Carbon Tax rates with the federal backstop pricing (announced in Budget 2020) until further notice. This will relieve all persons impacted by the Carbon Tax from the scheduled rate increase, including down the supply chain.
- Reducing school tax rates for commercial properties (Classes 4, 5, and 6) by 50 percent for the 2020 tax year, which the government claims will result in $500 million of immediate relief for businesses (See COVID-19 Action Plan: BC's first steps to support people, business, from the Office of the Premier on March 23, 2020).
The province has allocated $1.5 billion for economic recovery. In the longer term, the recovery plan will dedicate funding to sectors that are especially hard-hit, including tourism, hospitality and culture sectors.
An economic stimulus plan is forthcoming, as the BC government partners with labour leaders to build the plan.
Key measures aimed at individuals include:
- a new one-time, tax-free $1000 Emergency Benefit for Workers who receive federal Employment Insurance;
- the new federal Emergency Care Benefit for those with lost income as a result of COVID-19;
- rental support for tenants including a suspension on evictions of tenants in subsidized housing (applicable only to COVID-19 related evictions);
- a six-month freeze on student loan payments; and
- deferral programs for ICBC and BC Hydro bills for certain people (See COVID-19 Provincial Support and Information on the Government of British Columbia website, last updated March 23, 2020).
The Plan builds on the federal government's economic plan. The measures introduced seek to ease the burden on businesses and individuals to meet their expenses.
As of yet, the government has only outlined the key features of the plan. More details are forthcoming. In the meantime, businesses should consider whether these measures apply to them and how these changes will impact their operations.
Bennett Jones is committed to helping our clients navigate the rapidly changing environment during these unprecedented times. If you have any questions regarding the information in this blog post, or would like help determining how the Plan affects your business, please contact one of the authors. In addition, please visit our COVID-19 Resource Centre for other COVID-19-related materials.