The Government of British Columbia announced this morning it is moving forward with its plan to eliminate Medical Service Plan (MSP) premiums and introduce the Employer Health Tax (EHT).

Together, these measures will reduce taxes on people and businesses by approximately $800 million each year, stated a Ministry of Finance press release.

“The last government chose to double MSP fees, costing families hundreds of dollars a year. People deserve a break, which is why we’re eliminating regressive MSP premiums,” said Carole James, Minister of Finance. “The EHT is a fairer approach, similar to other provinces, and that means lower taxes for British Columbians.”

The government tabled the Employer Health Tax Act in the legislature on Oct. 16. Fewer than five per cent of B.C. businesses will pay the full EHT rate of 1.95%, and the majority of small businesses are protected with a $500,000 exemption amount that phases-out gradually. The legislation also establishes a $1.5-million exemption amount for charities and non-profits, and is similarly phased out.

The B.C. government will eliminate MSP premiums by Jan. 1, 2020, noting that will save individuals up to $900 each year, and families as much as $1,800.

In addition, the administration of MSP premiums is costly and inefficient, the Ministry of Finance said.

“Transitioning to the EHT will save more than $50-million annually.”

B.C.’s EHT rate is tied with Ontario for the lowest payroll tax rate in the country.

e-KNOW

Article Share