Double Blind

The 2006 BC Budget will be released today at 2:45pm. You can make some extrapolations on what will be in the budget based on the 2006 Budget Consultation Process Report. As a side note, I did make a submission to the committee that wrote the report, so you can find my name in the back of the document.

Without having any sort of insider information, here are my guesses on what will be inside the budget:

Some sort of tax credit for “healthy living”;

Money thrown at the Family and Child development ministry;

Spending initiatives on preventative health measures;

A formal debt management plan (consisting of getting the debt-to-GDP at a certain level by a very far-off date, but this will not include a plan to reduce the provincial debt to zero);

NO reduction in the PST (the media has been rumoured to predict a 1% drop in the PST), but possibly a provision to reduce the PST that municipal jurisdictions near the Alberta border would have to pay;

The previously announced $1B allocation for public sector wages this fiscal year;

A moderate increase in the basic exemption before you start paying provincial income taxes (perhaps raising it from $8900 to $10000);

Allocation of funding toward the Gateway project;

A healthy contingency reserve concerning natural gas royalties;

One LARGE surprise in the budget that I can’t predict here but will make headlines.

This will be Carole Taylor’s first budget. You can be sure there will be at least one surprise to keep the media busy. I would guess it would be a spending measure dealing with seniors or targeting the ageing population demographic. In general, I would expect the media to be focused on the spending measures of the budget although there will be a couple goodies on the tax side that should keep everybody other than the NDP happy.

About the PST, the reason why I am skeptical is because reducing the PST from 7 to 6% would cost the government about $580M. They are going to need this budgetary room to pay for the capital projects coming down the pipeline in addition to reducing their debt to GDP ratio. Also, the government knows that the natural gas royalty gravy train is about to end soon, so they won’t spend money they don’t have since Gordon Campbell is a fiscal conservative at heart. You usually save the spending binges in the budget before an election, while performing the nasty stuff just after you win one. Unfortunately, I don’t know what nasty measures the government could bring in for this budget – there’s no reason at this point to rock the boat.

This entry was posted on Tuesday, February 21st, 2006 and is filed under Politics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.