With an election imminent, it was not the B.C. Liberals’ fondest wish to appear in the pages of the New York Times.
But they landed there with a dull thud this week, in a highly interesting story about how a provincial tax incentive program has apparently been spraying about money without generating much in the way of jobs.
According to the Times story of May 2, the program was like many created across Canada and around the world – offer tax incentives to companies that set up shop locally. The hope is to create jobs, and such incentives usually have a time limit and are closely monitored.
But since 2008, the Times says $140 million in refunds have been doled out, creating between 300 and 122 jobs.
That’s not a great record.
But it gets worse.
The Liberals have been excoriated by the NDP and Greens for doing too little, too late, on the maddening increase in housing prices over the past five to six years.
It turns out that their tax incentive program may have been part of the problem.
“Companies can receive refunds on real estate transactions with foreigners, including mortgage loans on property in Canada for international buyers,” according to the Times.
So the government created an incentive for people to buy real estate in Vancouver, as prices were already on the upswing. They might as well have poured kerosene on an open fire.
To complete the picture of an ineffective, badly run, wasteful, and possibly destructive program, AdvantageBC is an arms-length non-profit that is funded by involuntary donations from the beneficiaries of the tax cuts. It’s run by former Liberal finance minister Colin Hanson.
Hanson now says that the purpose of the program was to make B.C. attractive to the financial services sector.
The last two major overhauls of the program were in 2008 and 2010 – after the financial services sector’s greed, corruption, and incompetence almost melted the world economy into slag.
And why on earth would we want to attract bankers? Bankers and millionaires destroy cities for ordinary people. From London to New York to San Francisco, things are great if you’re rich and have eight or nine million dollars to throw around on real estate. But people with ordinary jobs are living in 600 square foot bachelor suites, or their cars.
If the NDP or the Greens win this election, we may eventually find out what was going on with these tax breaks and AdvantageBC.
If the Liberals win again, I wouldn’t bet on it.