On March 23, 2020, in response to the COVID-19 pandemic, the Province of British Columbia announced a $5 billion COVID-19 Action Plan (the “Action Plan”) to help provide immediate economic relief to people and businesses, and lay the groundwork for BC’s long-term economic recovery, while protecting public health and safety. BC’s Action Plan builds on the Federal Government’s COVID-19 Economic Response Plan, which aims to stabilize the economy by providing over $82 billion in financial assistance to individuals and businesses. See our bulletin on the Federal Economic Response Plan here.
Members of the British Columbia Legislature unanimously passed legislation to fund the relief plan on the same day the Action Plan was unveiled.
The Action Plan will provide income support, tax relief and direct funding for people, businesses and services in BC. The Action Plan dedicates $2.8 billion to boost income and fund the services that individuals and families need to weather the crisis, and a further $2.2 billion to support businesses and help them recover. The measures include tax deferrals and reductions, a new emergency benefit for workers, rental support for tenants and funding for the tourism and hospitality sector.
Highlights from the Action Plan include:
1. Delayed Tax Filing and Payment - The Province will extend filing and payment deadlines for the provincial sales tax (“PST”), tobacco tax, motor fuel tax, carbon taxes, and municipal and regional district tax on short term accommodation to September 30, 2020.
2. Deferred and Delayed Taxes - Businesses with a payroll over $500,000 can defer their employer health tax payments until September 30, 2020 and businesses with a payroll under the $500,000 threshold will continue to be exempt from the employer health tax. The increase in the carbon tax, which was set for April 1, 2020, will be delayed, along with the PST registration requirements on e-commerce and the application of PST to sweetened carbonated drinks. The timing for implementing such taxes will be reviewed by September 30, 2020.
3. Reduction in School Tax - School tax paid by business and light and major industry property classes will be cut in half, which the Province estimates will generate $500 million in immediate relief for commercial and industrial property owners – savings it expects commercial and industrial landlords to pass on to their tenants under triple-net leases.
4. Bill Payment Deferrals - British Columbians will be able to request flexible payment plans or payment deferrals from ICBC and BC Hydro. ICBC is extending monthly payment deferrals to up to 90 days and customers will be able to renew their policies online. BC Hydro is providing Customer Crisis Fund Grants of up to $600 for those who are dealing with job loss, loss of wages, or illness due to COVID-19.
5. Support for Tenants - More information is to come on the Province's plans for supporting tenants, although Premier John Horgan has stated that no one in British Columbia will lose their homes because of COVID-19. BC Housing has temporarily suspended evictions of tenants in subsidized and affordable housing. The Province is also exploring additional support, including supplements for seniors.
6. Emergency Benefit for Workers - The new BC Emergency Benefit for Workers will provide a one-time, tax-free $1,000 payment to British Columbia residents whose ability to work has been affected by COVID-19. The benefit will be available to those who are eligible for employment insurance (“EI”), as well as those who are not available for EI, such as individuals who are sick or quarantined, those who are caring for sick family members, and those who are staying at home from work while child care centres and schools are closed. The BC Emergency Benefit for Workers will complement the new federal Emergency Care Benefit and Emergency Support Benefit.
7. Student Loan Postponement - Starting March 30, 2020, all student loan payments will be frozen for six months, until September 30, 2020.
8. Climate Action Tax Credit - BC is expanding its existing Climate Action Tax Credit in July 2020. Eligible families of four will receive up to $564 and eligible individuals will receive up to $218 in an enhanced payment. This boosts the regular Climate Action Tax Credit payment of up to $112.50 per family of four and up to $43.50 per adult. To be eligible for the tax credit, families first need to file their 2019 tax returns.
9. Investment in Critical Services - The Province will invest in housing supports, as well as income and disability assistance programs and crucial health services. It will also continue to provide funding to licensed child care providers, non-profits and service delivery agencies.
10. Long-Term Economic Recovery: The Action Plan also earmarks $1.5 billion for BC's long-term economic recovery, which will focus on spurring investment and economic growth in BC. The $1.5 billion will be used to assist some of the hardest-hit sectors such as hospitality and tourism after the COVID-19 crisis subsides. The BC Government has created a Recovery Task Force consisting of labour and business representatives which will assist in creating an economic recovery plan.