The B.C. government is creating tax breaks for families with children under 18, combining the previously established Early Childhood Benefit into a single new initiative: the BC Child Opportunity Benefit.
Coming into effect in October, 2020, the new benefit raises eligibility significantly. A family with one child is eligible for $1,600 per year, two children up to $2,600 per year and three children up to $3,400 a year – a jump from the existing benefit’s maximums of $660, $1,320 and $1,980 respectively.
The benefit is reduced by four per cent of each family’s net income over $25,000 and phased out at a four per cent rate of each family’s net income over $80,000.
James said the benefit takes a year to implement while the province works out details with the Canadian Revenue Agency.
The refundable tax credit will provide $380 million annually to B.C. families, and has no impact on eligibility for child care benefits.
Viveca Ellis of the BC Poverty Reduction Coalition said the benefit is a powerful tool to combat child poverty, but says the threshold – $25,000 – is too low to start reducing the benefit.
“We are disappointed to see the threshold for clawing back at $25,000. Leaving the threshold very low…means that single mother families and other families that are in poverty are going to see their BC Opportunity Benefit clawed back while they are still below the poverty line.”
“We would like to see that threshold raised right up to $40,000.”
No new funding was announced for child care programs in B.C. but funding continues to carry over from the 2018 budget –including a fee reduction for parents of children in licensed care up to $4,200 a year and an Affordable Child Care Benefit eligible to families households earning under $111,000.
“We added $300 million to support child care programs,” said finance minister Carole James. “Affordability is there for families and we expect that to grow and certainly hope that to grow…we’re also building child care spaces and supporting bursaries for early childhood educators.”