B.C. Budget - February 2020

The 2020 BC Budget presents limited changes for the residential construction industry in British Columbia. Continued investments in CleanBC incentives are positive, as are social housing projects across the province for those in greatest need.

CHBA BC member companies may be interested in the B.C. Access Grant for post-secondary programs, including the skilled trades, with a newly-announced expansion to include two-year and part-time programs. Developer members that operate as a Canadian-controlled limited partnership should note a new property transfer tax exemption to bring the rules in line with Canadian-controlled corporations.

Lastly, CHBA BC will be following the development of the new Integrated Transportation and Development Planning (ITDP) process announced in Budget 2020. Coordinating transportation and development is an essential task so that the maximum number of residents can benefit from government investments.

Quote from CHBA BC Chief Executive Officer Neil Moody:

“After many years of housing policy changes, the residential construction businesses across the province will appreciate the focus on a steady and stable path forward, as reflected in Budget 2020. We will utilize this next year to encourage government to implement the opportunities around development approvals to achieve greater housing availability and to communicate transparently on the newly announced integrated housing processes. We will continue the essential conversation on how we can collaboratively increase housing supply across British Columbia.”

 

Budget 2020 Backgrounder

The following has been identified and paraphrased for member reference from the BC Budget documents provided by the province on February 18, 2020. This is not a comprehensive list of all changes.

 

Economic Outlook
● The fiscal plan expects surpluses of $227 million in 2020/21, $179 million in 2021/22, and $374 million in 2022/23.
● The B.C. economy grew by 1.8 per cent in 2019.
● The government is expected to collect $660 million from the property transfer tax in 2020/21, and this figure is expected to rise 4.5 per cent over the next three years.
● Housing starts were up 10 per cent in 2019 to 44,932 units, but expected to decline 22.1 per cent to 35,021 starts in 2020.

 

Key Tax Changes
● Effective on a date to be specified by regulation, a new exemption for the property transfer tax will be introduced for qualifying Canadian-controlled limited partnerships. This will treat these partnerships in a manner that is more consistent with Canadian-controlled corporations. It will ensure that new housing developments will be treated similarly irrespective of whether the development is being undertaken by a Canadian-controlled corporation or a Canadian-controlled limited partnership.
● Effective for February 19, 2020, real property contractors who perform value-added work to goods and then install those goods into real property outside B.C. can apply for refunds of the provincial sales tax paid on those goods.
● A new personal income tax rate of 20.5 per cent, from 16.8 per cent, on taxable income over $220,000, effective January 1, 2020.

 

Transportation
● Over the next five years the government will be investing $9.2 billion in transportation infrastructure for projects that include the Pattullo Bridge replacement, Broadway Subway project, and Highway 1 improvements.
● A broader transportation and development study for the Fraser Valley region will inform transportation, development, and housing investments. This study will be in partnership with Translink and BC Transit.
● Additionally, the Ministries of Transportation and Infrastructure and the Ministry of Municipal Affairs and Housing will undertake a new Integrated Transportation and Development Planning (ITDP) process. This will create a collaborative vision for “B.C.’s transportation and affordable development needs that contribute to an efficient and accessible multi-modal transportation network that connects communities, regions and global markets.”

 

Housing Plan
● In Budget 2018, government announced an investment of $7 billion over 10 years to support housing affordability. As part of this commitment, Budget 2020 provides an additional $118 million in operating funding and $56 million in capital funding.
● The overall operating budget for housing programs has grown to $958 million in 2020/21 and will rise to $1.2 billion by 2022/23.
● Budget 2020 also provides an additional $56 million for 200 new units of supportive modular housing for people who are homeless or at risk of homelessness.
● $11 million to fund the public inquiry into money laundering.

 

CleanBC
● Budget 2020 provides an additional investment of $419 million to support CleanBC.
● This includes $20 million in funding to continue the Go Electric BC program with rebates for new battery electric or hydrogen fuel cell vehicles, $5 million in incentives for home and workplace charging stations, $2 million for new public stations, and $5 million in incentives for zero-emission buses and heavy-duty vehicles.
● $3 million is allocated for the Climate Adaptation and Preparedness Strategy.
● The budget documents indicated that a plastics action plan will be announced, but no program details were included.

 

Skilled Trades
● $24 million over three years for the BC Access Grant, an up-front needs based grant program for university and college programs. Students applying for StudentAidBC will be automatically assessed with no need to apply separately for the grant. This funding can go to tuition costs as well as basic living expenses. Two-year and part-time programs are now eligible for this grant, where they previously were not eligible.
● Negotiating a new Workforce Development Agreement with the Government of Canada, providing $685 million over six years to train and improve the skills of 67,000 British Columbians.
● $12.4 million to help more than 2,000 women, youth and other under-represented groups access skilled trades training.
● $7.5 million for trades training for nearly 500 people in Indigenous communities throughout B.C.
● $3.5 million to increase the number of apprentice advisors to increase support for both apprentices and employers.

 

Small Businesses
● The minimum wage will increase to $14.60 per hour in 2020 and $15.20 an hour in 2021.

 

For more information, please contact:
Alycia Coulter
Director, Government Relations
Canadian Home Builders’ Association of BC
alycia@chbabc.org
604-432-7112 ext. 302
www.chbabc.org

About the Canadian Home Builders’ Association of BC
The Canadian Home Builders’ Association of BC is the leading advocate of the residential construction industry in British Columbia representing more than 2,200 members through an affiliated network of eight local home building associations located throughout the province. The industry contributes over $28 billion in investment value to British Columbia’s economy creating 208,000 jobs in new home construction, renovation, and repair – one of the largest employers in British Columbia