BC Gov News
B.C.’s economy remains steady despite disruption and uncertainty from the global trade conflict, its First Quarterly Report shows.
“While B.C.’s diversified economy is better positioned than many to weather these headwinds, there’s no doubt that tariffs are challenging our economy and there is pressure on our fiscal position,” said Brenda Bailey, Minister of Finance. “We’re being focused with our spending, making smart reductions where we can, being strategic with our investments to drive economic growth and foster innovation to build a stable economic future for B.C., and support the services people count on.”
The update reflects the impact of government’s decision to help people with high costs by eliminating the carbon tax, as well as decreases in revenue sources, such as property transfer tax, sales tax, natural resources, federal government contributions and higher fire management costs. The updated forecast shows a deficit of $11.6 billion, $665 million higher than at budget, followed by $12.6 billion next year and $12.3 billion in 2027-28.
The 2025-26 deficit is partially mitigated by an increase in corporate income tax revenues and from B.C.’s share of the historic $32.5-billion lawsuit against tobacco companies in recognition of the harms caused by the companies’ actions.
The Province is on track to meet its three-year, $1.5-billion expenditure-management target first announced in Budget 2025, including more than $300 million in savings this fiscal year.
“We’ve made a commitment to review every dollar being spent to make sure it’s serving the needs of British Columbians and that work is reflected in our initial savings of $300 million this year,” Bailey said. “In the current fiscal and economic climate, we’re focusing on the key services that people and families need, and protecting the services we all depend on now, and for the future. This work is ongoing as we plan for Budget 2026.”
The Province’s diverse industries and access to global markets are helping support B.C.’s economy in the face of trade uncertainty. However, lower economic growth is projected for 2025 and 2026 due to tariff impacts, a slowing global economy, and a slowdown in the housing market. B.C.’s economy is expected to recover in the medium term, supported by a stable labour market, exports of liquefied natural gas and increased residential construction.
“We’re building our province’s position as the economic engine of a stronger and more self-reliant Canada, moving forward with major projects, including those identified by the federal government, that put people to work, drive economic growth and support strong communities,” Bailey said.
Learn More:
To access the First Quarterly Report, visit:
https://www2.gov.bc.ca/gov/content/governments/finances/reports/quarterly-reports
To access the PowerPoint presentation, visit:
https://news.gov.bc.ca/files/FirstQuarterlyReport.pdf
A backgrounder follows.