An unexpected increase in property transfer tax (PTT) revenue is a major reason the BC Government recorded an operating surplus of $2.74 billion as of March 31, 2017.
The surplus, reported in the audited Public Accounts 2016/17 released by Finance Minister Carole James on August 22, 2017, was more than 10 times higher than the $264 million estimated in the last budget.
PTT revenue was estimated at $1.239 billion, but climbed an astonishing $787 million to $2.026 billion—an increase of $493 million over the $1.533 billion in PTT revenue collected in 2016.
Revenue includes $102 million from the foreign buyers’ tax in Metro Vancouver.
The budget surplus will be applied to the provincial operating debt, as required by the Budget Transparency and Accountability Act.
The public accounts also show a $3.4 billion increase in revenue over what the Province had estimated and spending was $1.3 billion higher than originally forecast.
The government collected $2.8 billion more than budgeted, including $1.5 billion more than expected from personal income taxes.
In addition to the PTT windfall, increased tax revenue included $305 million more in provincial sales tax and $212 million more in corporate income tax.
BC’s gross domestic product (GDP) grew by an estimated 3.7% in 2016 and private sector economic forecasters expect BC to be among the top provincial economic performers this year and next.
The Province’s fiscal outlook is for continued and stable economic growth.