Ministry of Finance and Corporate Relations
109 -- 617 Government Street
Victoria, B.C. V8V 1X4
PHONE (604) 387-3347 FAX (604) 356-2822
BUDGET '95 FACT SHEET
British Columbia's Fiscal Plan
Budget '95 builds on the progress of the past three years to strengthen the province's finances.
This prudent financial management guarantees that B.C. can continue to deliver needed health care and education services, and make affordable investments in people and infrastructure to keep the economy growing and create more jobs.
Eliminating the deficit and reducing debt
When this government took office three-and-a-half years ago, it inherited the largest deficit in the history of the province -- $2.4 billion.
In 1994/95, the operating deficit had been revised downward to $370 million -- a reduction of over 80 per cent.
The deficit has been eliminated a full year ahead of schedule. The 1995/96 budget has a $114 million surplus. The government is now shifting the focus of its financial management from the deficit to the debt.
Capping B.C.'s debt costs
The debt management plan will maintain B.C.'s high credit rating by:
This plan sets tougher benchmarks than those recommended to the government by a group of provincial business and labour leaders.
- paying off over 20 years the $10.2 billion of debt incurred from previous annual budget deficits, beginning with a pay-down of $414 million this year -- the $114 million surplus and $300 million of proceeds from the final sale of the B.C. Endowment Fund assets.
- holding increases in government spending to less than the growth of the economy so that, over time, the cost of government declines.
- capping the cost of taxpayer-supported debt at 8.5 cents for every dollar of government revenues -- and reducing that cost over time.
- cutting taxpayer-supported debt in half -- from 19 per cent of the provincial economy today to 10 per cent in 20 years.
A debt management progress report will be published each year, and will be reviewed by the auditor general for accuracy and completeness.
Three-year tax freeze continues
The government's tax freeze will continue for another two years -- that means no new taxes, and no increase in personal or corporate income, sales or other consumer tax rates.
B.C. continues to have both the second-lowest total direct taxes for individuals and the second-lowest sales tax rate in Canada.
The tax freeze has supported job growth by boosting investor confidence. Last year, business non-residential investment grew by 23 per cent and 67,000 new jobs were created in B.C.
Affordable investment to keep B.C.'s jobs and economy growing
The 1995 budget supports job growth by investing in education and skills training, health care and economic infrastructure.
Budget '95 (Province of B.C.)
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