Prices have soared recently. Faced with the soaring cost of living for residents, the BC Provincial Government has provided countermeasures: limit the increase in rents and promote a new round of tax credits and child welfare funds.

Prices have soared recently. Faced with the soaring cost of living for residents, the BC Provincial Government has provided countermeasures: limit the increase in rents and promote a new round of tax credits and child welfare funds. In the next six months, the government will issue a total of 600 million subsidies.

.6 billion one-time subsidy

BCGovernor He Jin announced on the afternoon of September 7 that under the current inflation situation, in order to help low-income families improve their living standards, the government will issue 500 million Canadian dollars in BC province climate action tax credit (increased since early October) and 100 million additional child welfare payments (it is expected to be launched in January 2023 for three consecutive months).

(Picture source: Vancouver Sun)

Of course, not everyone has these 600 million subsidies, mainly focusing on supporting middle- and low-income families. “We recognize that not all plans benefit everyone equally,” Finance Minister Selena Robinson said, adding that the province uses existing plans to target those who need help the most.

10 Starting from October, the maximum amount of climate action tax credit for low- and middle-income households in BC Province (annual income of CAD 36,900 and below) will increase to CAD 358 per adult . Starting from January 2023, the tax credit will fall back to CAD 195.

Families with two children can receive up to 410 Canadian dollars in additional grants. Once the plan is completed, 85% of residents are expected to benefit from it.

Regarding child welfare funds, He Jin said that within three months from January 2023, the child welfare funds will rise to 58.33 Canadian dollars. and the tax credit are included. It is expected that a family of four can receive a subsidy of about 1,500 Canadian dollars from this plan.

In the past few months, residents of BC Province have been plagued by high prices, and the cost of living is close to the highest level in 40 years. The BC provincial government has repeatedly promised to provide subsidy support, and now this promise has finally been fulfilled.

Rent increase by 2% capped

Although the government allocates 600 million yuan, which seems to be huge, short-term subsidies seem to make it difficult to relax. The bad news is that the growth of residents' income is significantly lower than the inflation level, which undoubtedly adds to the lives of low- and middle-income families.

The most frightening thing is the renter. For months, the BC government has pledged wage support, and the cost of living is close to a level not seen in more than 40 years. Since Canadian inflation has remained above 7% in recent months, and has remained high, many residents are worried that rent increases will be significant next year.

BC Province has 1.5 million people who are renters. In response to their doubts, the BC Provincial Government decided that the rent increase next year shall not be higher than 2% . Take a family with a monthly rent of 2,000 Canadian dollars as an example. The rent will only increase to 2,040 Canadian dollars next year, which means that the family can save up to 816 Canadian dollars in rent.

(Image source: Global News)

However, this seems not good news for the landlord. A spokesman representing 3,300 BC landlords said the 2% rent cap was “worrying and disappointing”, after all, landlords had to eat.

BC Landlords Association CEO David Hutniak said landlords are facing the same cost increase as BC residents, with their construction insurance costs, property taxes and utility expenses all rising.

"If we don't start looking for some viable solutions, it will really put the entire rental housing ecosystem in serious danger," Hutniak said. "The system is in trouble at the moment, and doing so will only get worse."

In response, He Jin responded that he will work with landlords in BC to come up with solutions that meet their needs, but the primary issue now is the need to solve the "crisis" that renters have experienced. However, the 2% increase in housing prices is also an increase, and it is still unknown whether tenants are satisfied.

It is expected that by the end of 2022, the BC Provincial Government will issue another subsidy. The government will work with BC Hydro to develop a cost-of-living policy to help BC residents reduce spending during a period of high global inflation . Currently, BC is considering providing cash back or checks directly to residents.

According to data released by BC Finance Minister Selina Robinson, last year, the BC provincial government made a total of 1.3 billion Canadian dollars in surplus. The current tax refund policy is mainly to refund part of the taxes that were previously overcharged.

What has the federal government done?

Faced with the issue of affordability for Canadians, Prime Minister Justin Trudeau (Justin Trudeau ) announced a three-pronged plan at the Liberal Party cabinet meeting on September 8.

According to sources, the plan will double the cargo tax (GST) tax credit to help Canadians who are difficult to pay rent. At the same time, the plan will also launch a temporary dental care plan for children from low-income families , and provide a 500 grant for those who receive Canadian housing subsidies (Canada Housing Benefit).

(Image source: Global News)

These plans are undoubtedly to fulfill the promises made in seeking support with the New Democratic Party (NDP). New Democratic leader Jagmeet Singh has made it clear that if the Liberals do not advance these priorities, this could undermine the agreement and the Liberal minority government will not get a critical vote.

According to Canadians’ tax returns, low and middle-income residents will receive a GST credit check every three months as a rebate for some of the GST they pay.

check amount is adjusted based on its annual income. For those earning 49,000 J CAD and below, the current benefits are up to 467 CAD per year, 612 CAD per year for married or cohabiting partners and 161 CAD for children. It will double on that basis within the next 6 months.

In addition, the Liberal Party has promised to launch a national dental health program, first covers children under the age of 12 with family incomes below CAD$90,000.

Phase I is expected to cost 300 million , which will increase to 1.7 billion cc per year after the implementation of the complete dental care plan.

This year's housing subsidy will be distributed in one lump sum of 500 Canadian dollars , with a budget of 475 million Canadian dollars.

From this perspective, there are indeed a lot of welfare subsidies in the short term. But after all, the wool comes from the sheep. Although it is also good to get short-term economic subsidies, the most important thing is to stop the momentum of inflation and fundamentally solve the problem.