B.C. business groups tell finance committee they want lower taxes 

By Shannon Waters June 14, 2022

The Surrey Board of Trade and the Greater Vancouver Board of Trade want the province to conduct “a comprehensive tax review” as businesses find themselves “buried in provincial debt, rising inflation and an even higher cost of living” in the wake of the pandemic.

“What we need is to create a commission to review all of the taxes that are eroding a business’s bottom line and determine debt levels, ensuring that we’re finding revenue opportunities and ensuring that you’re conducting consultations with the business community,” Surrey Board of Trade CEO Anita Huberman told the Select Standing Committee on Finance and Government Services yesterday.

She pointed to Nova Scotia and New Zealand as examples of jurisdictions that conducted tax reviews of the kind the Surrey board has in mind — creating a commission to consult with the business community, assess spending and debt levels, and identify current and future fiscal challenges facing the province.

The taxes most in need of review, per Huberman, are general sales tax and the provincial sales tax, the employer health tax (EHT) — implemented by the NDP to replace Medical Services Plan premiums — fuel taxes and “other red-tape … that is really eroding a business’s bottom line.”

Greater Vancouver Board of Trade President and CEO Bridgitte Anderson speaks during budget consultations Monday morning. (Instagram/@theboardoftrade)

The EHT “absolutely needs to be re-evaluated,” according to Bridgitte Anderson, CEO of the Greater Vancouver Board of Trade, who said multi-business owners experience “significant bottom-line erosion” as the tax is paid based on per company payroll.

“It’s taxation and the regulatory system that really hold businesses back in their ability to grow and scale,” she told the committee, highlighting “an onslaught of new government policies that have increased costs for employers,” including employer-paid sick leave and increases to the minimum wage.

The EHT costs B.C. businesses $1.9 billion per year, according to Anderson, and paid sick leave could add another billion to their cost burden.

“If we’re talking about the five days, if there was a 45 per cent uptake, it would be … between $506 million and $1.1 billion,” she told the committee.

To help struggling businesses, the Greater Vernon Chamber of Commerce proposed that next year’s budget bring back the provincial sales tax rebate “on most machinery and equipment purchased” by small businesses. The rebate was rolled out in response to the pandemic but ended on March 31.

Continuing the program would be cost-effective for the province, per chamber president Robin Cardew, and would allow businesses to redirect the money saved into growth and operational improvements.

Huberman and Anderson would like to see the PST rebate expanded to “computer, software and telecommunication services,” a move that would cost the province about $200 million per year and incentivize businesses to invest in tech.

Housing costs are hamstringing businesses, committee hears

“Workforce housing is a huge challenge,” Bruce Williams, CEO of the Greater Victoria Chamber of Commerce, told the committee.

Southern Vancouver Island boasts “inarguably the second-most expensive market in Canada,” per Williams, who lauded the NDP’s investments to house homeless people and the launch of complex-care housing but said the chamber sees a need for housing for “all levels of affordability,” both rental and sale options.

The housing minister should look at ways to help developers build housing featuring “daycare and multi-purpose facilities,” Williams said.

“We would love to see the province step up to make that easier,” he told the committee.

Williams said the chamber would also like to see the government “invest in making government workplaces” — especially in the downtown core — “more acceptable for people to return to their offices” in order to increase “the vitality and the sustainability of the downtown area.”

Over on the mainland, 83 per cent of Greater Vancouver Board of Trade members report having trouble keeping staff due to “B.C.’s shortage of available and affordable housing,” per Anderson.

She told the committee the board wants to see “bold action” from the province” on “zoning and permitting” at the municipal level to boost the housing supply — something that Housing Minister David Eby’s legislation, promised for the fall session, may address.

Huberman said Surrey also needs more housing but pointed to the provincial permitting process as a barrier.

“Our development approvals get held up at the B.C. government office in the department of forestry, especially with those lands that have water barrier features, of which there are many in Surrey,” she said, suggesting a staffing boost could help.

Huberman also asked the committee to consider reviewing the cost of transitioning Surrey to a municipal police force from the RCMP, noting “over $2 million has already been spent and has impacted the B.C. budget.”