Finance Minister Michael de Jong tabled the B.C. budget earlier this week and it included moderate initiatives to boost various sectors of British Columbia’s economy.
Highlights include: an investment of $5 million over five years to further expand B.C.’s aerospace industry; $2 million to the Buy Local program to help farmers and food processors promote their B.C. products; $5.4 million for aboriginal skills training; an increase to the Small Business Venture Capital tax credit; and an extension of the Digital Animation or Visual Effects tax credit.
Douglas asked Greater Victoria business leaders for their opinions on the budget and how it will affect local and Vancouver Island businesses.
Bruce Carter, CEO, Greater Victoria Chamber of Commerce: “I think there were four good things in the budget for local businesses. The first was the extension of the Interactive Digital Media tax credit. We have a large number of firms in our tech industry that are in that area of business, so the extension of that for three years will help that sector grow. The extension of the Digital Animation or Visual Effects tax credit to include post-production is also very positive. It relates to our film industry and some of the other capacities that we have in the digital industry. Applying that to post-production could significantly grow that area of work and business. Then there’s the additional $3 million to the Venture Capital tax credit, which I think is good. Beyond that, the change in the level of the Destination Marketing Hotel tax from two to three per cent. I think there is an opportunity there for us to increase our tourism marketing.”
“We do have a challenge around BC Ferries and there’s a modest increase in the fee subsidy to BC Ferries but not along the lines that will mitigate the need for fare increases and, I think, fare increases over and above the rate of inflation, so that’s going to be a real challenge as we move forward.”
Tim Teh, CEO, co-founder, KANO/APPS: “We’re ecstatic [about the Interactive Digital Media tax credit]. Looking at the growth of the industry as a whole since 2008 and the emergence of mobile and social gaming, the barrier of entry is relatively low — all you need is labour to create a game and put it online. With the continued 17.5 percent off of labour, it’s definitely helpful for the studios. For us, specifically, it allows us to accelerate growth. We’re profitable as a company, but we can work on new projects and take bigger risks.”
George Hanson, president, Vancouver Island Economic Alliance: “I think the provincial government needs to be commended for accomplishing a balanced budget. It’s not an easy thing to do. I think the focus on diversifying the economy is extremely positive. If you look at their graphics, the relative stability of the B.C. economy based on its export portfolio, for instance, is encouraging. And I think the investment in aerospace has potential for the Island because we have a burgeoning aerospace industry on Vancouver Island.”
“The continuance of all the systems to help those below the poverty line is also important because a fair percentage of our population on the Island struggle economically.”
Greg Baynton, CEO, Vancouver Island Construction Association: “First of all, like most people and organizations, we’re pleased that there’s a surplus — a larger surplus than anticipated. I think that is a reflection of the fiscal management of the government. It sets the stage for the economic environment and future of the province, so we like that. In terms of how it impacts our industry, we’re pleased to see that the capital spending on capital projects and infrastructure has remained intact. We were kind of concerned there could be some cuts in that area. I think that the fact that there was a surplus as large as there was, gave the government some confidence to continue to invest in infrastructure.”
“That being said, we’d like to see a long range plan for infrastructure planning and investment. Typically what happens in the public sector, and this isn’t unique to B.C., when time are tough and cash coffers are reduced, the government cuts back a lot in that area. Infrastructure stimulus is one of the best places to invest to stimulate the economy and it’s also the best time to actually buy services and build infrastructure because the cost is low and the interest costs are very low. Governments tend to buy infrastructure when the tax coffers are full and the economy is good, and they pay a premium for that. And it’s not when the marketplace or the economy needs it most. So, we’d really love to see a long-term infrastructure strategy and plan for the province.”
“We’re really pleased to see the understanding of the labour market. In the construction sector, we’re going to have a skills shortage of about 50,000 people over the next 10 years, and that’s resonated with the government. We’re not the only sector that’s challenged like that. So, there is a real investment in their Skills for Jobs Blueprint and in continuing to invest in education. We’re really pleased with, not only the recognition, but the actions and investment they are taking in that regard.”
For more information on the budget, visit bcbudget.gov.bc.ca