File Photo (Image Credit: CFJC Today )

By Jill Sperling

Employer Health Tax

Kamloops Chamber president says businesses, consumers paying for elimination of MSP

Jan 7, 2020 | 4:42 PM

KAMLOOPS — B.C. residents no longer have to pay Medical Service Plan (MSP) premiums, but businesses are still adjusting to the replacement Employer Health Tax.

Any business with a payroll of more than $500,000 was charged the Employer Health Tax beginning in January 2019.

At the same time, many companies were also paying MSP on behalf of their employees. While they will no longer have to pay MSP, Kamloops Chamber of Commerce President Joshua Knaak says B.C. residents will ultimately foot the bill.

“Margins are margins,” Knaak said, “and the fact of the matter is it’s an additional cost for business and just as it’s true with any cost that’s ultimately born by the customer, by the consumer. It’s shifting a tax, for sure, it’s shifting it from individuals to business, but at the end of the day we’re still paying for it.”

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Knaak says some local businesses have worked to stay beneath the $500,000 threshold in order to avoid the additional tax. This means the businesses have been unable to hire additional staff.

One year into the implementation of the Employer Health Tax, Knaak says businesses are beginning to view it as normal.

“I think businesses are adjusting to it, but this is just one of actually, the reality is, many tax increases and cost increases that B.C. businesses particularly have experienced, and we’re hoping that we can get a period of time here to sort of normalize things.”