The B.C. government continues to reduce its expected surplus this year, as consumer spending cools off and revenue from forest products and other resources declines.
Finance Minister Carole James released the provinceB次元官网网址檚 second quarter financial results Tuesday, showing $133 million reduction in expected forest revenues for the year ending next March. Coal, electricity and oil and gas revenues have also seen a reduction in revenue forecasts, with natural resource revenues in general down $235 million from the first quarter estimate.
Finance Minister describes the slump in natural resources, especially forest products
B次元官网网址� Tom Fletcher (@tomfletcherbc)
Income tax revenue forecasts are up, based on B.C.B次元官网网址檚 continued strong population and employment growth, but consumer spending is slowing down. James said that is due to economic concerns, both in B.C. and globally.
Retail sales grew by only 0.6 per cent during the first six months of the 2019-20 fiscal year, continuing a slowdown from 9.3 per cent growth in 2017 and two per cent last year. The slowdown is primarily B次元官网网址渁 decline in housing-related spending and new vehicle sales,B次元官网网址� James said.
Average home sale prices fell by 3.3 per cent up to October 2019, after a slight increase in 2018. Housing starts are up so far in 2019, with 45,112 starts so far in 2019 compared to 40,857 in 2018.
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Revenue forecasts for the B.C. Lottery Corp. and Liquor Distribution Branch are down from the September forecast, with lower casino revenues and sluggish sales for legal marijuana in B.C. James said there is some improvement in sales from B.C. Cannabis and private retail stores, but it is too soon to say if the province will break even on cannabis sales in the current year.
B次元官网网址淏.C. Liquor Distribution Branch net income forecast has declined $18 million due to the delayed rollout of private and public cannabis stores and lower than anticipated demand,B次元官网网址� the states.
Will BC break even on sales this year? Still soon to say, says
B次元官网网址� Tom Fletcher (@tomfletcherbc)
James said other cost-saving measures are in the works for ICBC, which saw billion-dollar losses the last two years before a cap on B次元官网网址減ain and sufferingB次元官网网址� awards and diversion of smaller injury claims from court took effect in April. The budget continues to carry a $500 contingency fund to cover ICBC losses this year, as higher premiums and a new risk-based rate system come into effect.
Overall, the province now projects a surplus of $148 million, down from $179 million in the September update.
tfletcher@blackpress.ca
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