Idea Transcript
Budget 96 For immediate release April 30, 1996 BUDGET DELIVERS ON TAX CUT, TAKES NEW ACTION ON DEBT VICTORIA - A tax cut for middle-class and working British Columbians, over 40,000 new jobs, a surplus budget and new action to reduce debt are highlights of the 1996 provincial budget, brought down today by Finance Minister Andrew Petter. "Taxes are down. Jobs are up. The budget is balanced. Health care and education are protected," said Petter. "B.C. voters told us in the recent election campaign that they also want to see us work harder to cut the cost of government and reduce the debt," said Petter. "We're announcing action today that will do exactly that: a comprehensive review of all government programs and a freeze on all new capital projects while a review of capital spending takes place." Tax cuts for B.C. families and small business "The centerpiece of this budget is a tax cut for British Columbians and small businesses," said Petter. "And we will be passing a new law that freezes other taxes and prohibits any new taxes on individuals and their families until the year 2000." British Columbians will also benefit from a freeze in BC Hydro rates, ICBC premiums and college and university tuition fees. The first tax cut takes place this Monday, July 1, when the provincial personal income tax rate will be reduced by one percentage point. It will be cut a second point in 1997. The tax reduction will be capped for taxpayers earning more than $80,000. "The income tax cut, combined with the BC Hydro and ICBC rate freezes and the post-secondary tuition fee freeze, will save the typical B.C. family of four making $55,000 a year up to $500 annually," said Petter. Other tax measures include raising the threshold for the home owner grant so that 96 per cent of British Columbia homeowners receive the full benefit of the grant. And the property transfer tax threshold is increased so more first-time home buyers will be exempt from the tax - saving them up to $3,500 on the purchase of their home. "A tax cut for small businesses - the sector of the economy that creates the most jobs - will provide $29 million in tax relief," said Petter. Effective July 1, 1996, the small business income tax rate is cut by 10 per cent. A two-year income tax holiday will be in effect for new, small businesses incorporated on or after May 1, 1996 and on or before March 31, 2001. Responding to voters concerns about the cost of government and government debt "This budget builds on the progress we've made to reduce the cost of government. Real per capita spending will go down by 2.2 per cent from 1995/96 levels." The 1996 budget will produce a surplus of $87 million. Total government debt will be reduced by $99 million while direct debt will decline $53 million. "We've taken a number of actions to cut the cost of government and balance the budget, while protecting health care and education. But voters have made it clear they want to see more cost-cutting and a new emphasis on debt reduction," said Petter. "The voters have spoken. We've listened. And today, we're announcing two new actions to cut the cost of government and reduce B.C.'s debt." Effective immediately, the government will undertake: A comprehensive review of all government programs. The review will examine every government program with the goal of streamlining bureaucracy, increasing government efficiency and cutting costs without dismantling the quality services B.C. families value. A freeze on all new capital spending. The freeze will allow a review of capital spending with the objective of reducing spending and the related debt, while ensuring that government makes the investments necessary to support British Columbians' priorities. Projects now under construction or to which the government is legally committed will proceed. All other capital spending is frozen pending the review, which will be completed this fall. Other recent actions to cut the size and cost of government include: eliminating 2,200 positions from the public service, saving more than $210 million annually, cutting the number of ministries from 18 to 15, the smallest number of ministries in 35 years, cutting spending in two-thirds of government ministries, while focusing resources on priorities like health care and education, eliminating two Crown corporations - BC Systems and BC Trade - saving $71 million a year, ending the MLA pension plan that was out of line with other public and private sector plans, and saving up to $113 million by holding the line on public sector wages. Protecting health care and education "British Columbians voted to protect funding for health care and education. That's exactly what we're doing in this budget," Petter said. Actions taken this year include: increasing hospital funding by 2.5 per cent over 1995 levels, providing new funding to reduce waiting lists for heart surgery, cancer treatment, and hip and knee replacement surgery, a new B.C. Health Care Scholarship to help 300 health care workers a year upgrade their skills, increasing school funding by 3.5 per cent to accommodate population growth, protecting funding for students in special education, aboriginal education, school meal and inner city school programs, guaranteeing spaces for every qualified student who wants to enter a post-secondary institution - adding 7,000 new spaces this year, and freezing tuition fees for post-secondary students for two years. Jobs are a top priority The budget forecasts strong economic growth of 2.7 per cent this year: 40,000 new jobs will be created in 1996 and 43,000 in 1997. New initiatives include: 21,000 more forest sector jobs in partnership with the industry, to get more value and jobs from every tree cut in British Columbia, 5,000 new jobs over five years in environmental technologies, a new partnership with the tourism industry that will help create 23,000 new jobs over the next five years, the Guarantee for Youth - the most comprehensive youth jobs and training initiative in the province's history, and training and work experience for more than 20,000 youth on welfare through the BC Benefits program "Youth Works." Special emphasis will be placed on protecting the salmon fishery with the development of a strategy that conserves fish and protects the jobs and coastal communities that depend upon them. "We will also introduce a comprehensive jobs plan that brings together business, working people, communities and government to build on our success in protecting and creating jobs," said Petter. Conclusion "Today's budget marks the beginning of a new mandate for this government. We will turn now to the challenge of lowering debt while ensuring continued economic growth and protecting health care and education," said Petter. "This budget shows that the government is listening to British Columbians and acting on their concerns. "We are cutting taxes, taking action to reduce debt, creating jobs and protecting the key services that British Columbians expect from their government." -30Budget '96 (Province of B.C.)
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