Usually, the first budget of a new government is a pretty important statement about where it intends to take the province.
Ideally, it provides a boost and gives the new administration the momentum it needs to carry out its mandate.
Unfortunately for the new finance minister, her first budget may have the opposite effect and actually drag down its fairly ambitious social agenda.
I am talking of course about the new tax on jobs called the Employer Health Tax.
It shocked the business community when it was announced on budget day, and lots of companies thought it was just the private sector that was going to bear the brunt of cancelling MSP.
The minister claims 85 percent of companies in B.C. will not be affected by the tax, but in the days and weeks since the budget was announced, it’s become abundantly clear that business isn’t the only one going to pay.
School boards, municipalities, health authorities, non-profit service providers and even some charities are going to be captured by the new payroll tax.
This has taken everyone by surprise because there was no public consultation before the tax was sprung three weeks ago.
This puts finance minister Carole James between a rock and a hard place.
On the one hand the government announced a huge increase in social spending. That’s fine if you have the money to do it, but it is quite another thing when you can’t afford it.
There is talk about making exceptions for certain employers but that cuts into the revenue stream that the government is already counting on to balance the budget.
The finance minister says she intends to have ‘conversations’ in the future, but the problem is this tax has already bolted from the gate without much consideration for unintended consequences.