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VICTORIA — B.C. is expanding the tax it created to clamp down on real estate speculation and ensure homes in rental-strapped communities don’t sit empty.
A statement from the Ministry of Finance said the Speculation and Vacancy Tax now includes the municipalities of North Cowichan, Duncan, Ladysmith, Lake Cowichan, Lions Bay and Squamish.
Starting early next year, homeowners in those areas will join owners in 40 other B.C. cities, districts and towns who are required to declare how their property was used in 2023.
The statement said 99% of people who live in B.C., can expect to be exempt for the 2023 tax year, but homeowners in the new municipalities, along with those already covered by the tax, must make formal declarations in the new year.
Failure to make an accurate declaration can lead to a penalty amounting to between 0.5% and 2% of the property’s total value, depending on whether the claimant is a Canadian citizen or a foreign owner.
The tax, in place since 2018, covers most residential properties in the Metro Vancouver and Capital regional districts, the districts of Mission and Lantzville and the cities of Abbotsford, Chilliwack, Kelowna, West Kelowna and Nanaimo.
Funds raised are returned to the areas where the tax applies, the ministry said.
The statement shows more than $313 million has been raised since 2018, with the money used to build new, more affordable types of housing.
Finance Minister Katrine Conroy said the tax was being expanded to ensure homes are available.
“People in our province expect housing to be used as homes, not investments for speculators,” Conroy said in the statement. “The speculation and vacancy tax is making sure homes are available for people, not left empty.”
Ministry data show the measure helped turn approximately 20,000 empty condos into homes in Metro Vancouver, and they said expansion of the tax is anticipated to bring more homes to communities struggling with low vacancy rates.
Teck Resources Ltd.’s move to cancel a key shareholder vote on its plan to separate its businesses may be seen as a win for Glencore in its ongoing campaign to acquire the Vancouver-based mining company.
But Teck is standing by its assertion that the offer by the Swiss commodities giant remains a “non-starter,” and Teck CEO Jonathan Price indicated Wednesday the company may be receptive to other suitors.
“We have premium businesses. And when it comes to (mergers and acquisitions), we firmly believe that competition for assets drives value,” Price told a conference call with analysts.
Teck announced just hours before its annual meeting Wednesday that it will not go ahead with the vote on its plan to split its metals and steelmaking coal businesses into two companies.
The move suggested the company did not believe it had the two-thirds approval from shareholders required for its proposal, which would have split the company into Teck Metals and Elk Valley Resources.
But Price said shareholders have made it clear they still like the idea of generating value by separating Teck’s steelmaking coal assets from its metals business. He said the company will now pursue a “simpler and more direct approach” to do that.
Price declined to elaborate on options the company may be considering. He also declined to say whether Teck has been approached by any other prospective buyers.
“I won’t speculate in any detail on that,” Price said. “But suffice to say that the process we’ve been through over the last two months, which of course has been a very public one, has seen a significant interest in both businesses, EVR and Teck Metals. And it’s very clear that the value of those businesses is well-recognized.”
Glencore, which declined to comment Wednesday, had been urging Teck shareholders to reject the company’s separation proposal. The Swiss company has said all along it would be unable to pursue its own hostile takeover bid if Teck’s plan to separate its businesses went ahead.
Price suggested that additional buyers could come forward once Teck splits its coal assets from its metals business.
“We expect there would be significantly more interest in the businesses on a stand-alone basis,” he said. “And that is one of the reasons we continue to believe that separation is the right path forward here.”
Sumitomo Metal Mining Co. Ltd., a key shareholder at Teck Resources Ltd., says it will vote in favour of the company’s plan to separate its metals and steelmaking coal operations into two companies.
The Japanese company says in a statement that it has built a trusted partnership with Teck in the mining business.
Swiss company Glencore has proposed a takeover offer for Teck that would have shareholders receive a stake in a combined metals company as well as a choice of cash or shares in a company that would hold their merged coal assets.
However, Glencore has said Teck shareholders must first reject the company’s plan to split its business into Teck Metals and Elk Valley Resources.
Teck, which has rejected the Glencore proposal, is controlled by the Keevil family, which owns the company’s multi-voting class A shares together with Sumitomo.
Sumitomo holds 18.9% of Teck’s class A shares and 0.1% of its class B shares. It also holds a 49% interest in Temagami Mining Co. Ltd., which holds 55% of Teck’s class A shares.
A 6.9% minimum wage hike mandated by the B.C. government is “unsustainable” for some businesses when stacked on all other costs downloaded onto business, say a number of business groups.
As of June 1, the B.C. government is raising the minimum wage from $15.65 to $16.75 per hour, the province announced Wednesday.
“Having a minimum wage that keeps up with inflation is a key step to prevent the lowest paid workers from falling behind,” B.C. Labour Minister Harry Bains said in a statement. “These workers and their families feel the impacts of high costs much more than anyone else. We are maintaining our policy of tying the minimum wage to inflation.”
But the 6.9% increase actually exceeds inflation, according to the Surrey Board of Trade, which pointed out the consumer price index is 6.2% for B.C. and 5.2% for Canada.
“The Surrey Board of Trade is disappointed that such a significant minimum wage increase was announced today, leading to further unsustainable cost increases for businesses,” CEO Anita Huberman said.
“Such a significant increase in minimum wage should have been discussed last year with the business community, especially in the face of other unprecedented increases in taxes and fees from other levels of government.”
“B.C. small businesses are feeling the pinch of inflationary pressures, on top of other cost increases from governments,” said the Canadian Federation of Independent Business.
“The 6.9 per cent increase to the minimum wage effective June 1 puts small businesses in a difficult position because they don’t have the ability to absorb higher costs. In addition, over half of the province’s small businesses are still experiencing below-normal sales and are carrying an average of $85,000 in pandemic-related debt.
“Cost pressures from the government are at an all-time high, including employer-paid sick days, the Employer Health Tax, WorkSafeBC premiums, skyrocketing property taxes, rising carbon taxes, and a new statutory holiday. This new 6.9% increase for a small business with 10 minimum wage employees will add nearly $20,000 of additional payroll costs.”
“A 6.9 per cent increase to labour costs is a large burden with less than 60 days notice,” Richmond Chamber of Commerce CEO Shaena Furlong said. “Most employers I speak to are in favour of regular increases to the minimum wage, but more time and a graduated approach would help them adjust accordingly.
“When we aggressively layer costs onto employers, we don’t only risk losing their tax contribution, but also the local jobs they create, and the vibrancy they add to our communities.
“In Metro Vancouver, most of us know someone who moved out of the region or the province because they realized they could get more for less elsewhere. Unfortunately, at some point businesses make that same calculation. We urge the province to not only provide more notice for updates to the to the minimum wage but also offset these added costs through any means at their disposal.”
VICTORIA — Prime Minister Justin Trudeau said he was “as surprised as” B.C. Premier David Eby after a firm received Health Canada licence amendments to produce and sell cocaine.
Trudeau said Friday that the federal government was “working very quickly” with Adastra Labs of Langley “to correct the misunderstanding” caused by the company’s statement saying it was looking at commercializing cocaine as part of its business model.
He said Adastra did not have permission to sell cocaine on the “open market,” while Health Canada said the firm could only sell to other licence holders.
This comes as a second B.C. company says it is now licensed to produce, sell and distribute cocaine, as well as opium and MDMA, also known as ecstasy.
Victoria’s Sunshine Earth Labs, a biosciences firm that “aims to bring safer supply of drugs to the global market,” says in a news release it obtained an amended Controlled Drug and Substances Dealer’s Licence to include MDMA and cocaine last year.
In a written statement, Health Canada says it “thoroughly reviews applications” to ensure licensees follow all existing policies on public health and safety.
The federal agency says Adastra’s licence is for “scientific and medical purposes only,” and licensees can only sell to others who are licensed to possess the substance.
“Health Canada has contacted the company to reiterate the very narrow parameters of their licence,” the agency says. “If the strict requirements are not being followed, Health Canada will not hesitate to take action, which may include revoking the licence.”
Trudeau said commercializing decriminalized cocaine “is not something that this government is looking at furthering.”
“I was as surprised as the premier of British Columbia was to see that a company was talking about selling cocaine on the open market or commercializing it,” he said, adding that Adastra’s licence was “not a permission to sell it commercially or to provide it on an open market.”
The public uproar began after B.C. Opposition leader Kevin Falcon raised the issue during question period at the provincial legislature on Thursday.
In response, Eby said he was “astonished” by the news, and the province had not been notified or consulted by Health Canada on the matter.
Adastra Labs said Health Canada approved its licence amendment to produce, sell and distribute cocaine on Feb. 17.
CEO Michael Forbes had said in a statement that it would evaluate how the commercialization of the substance fits in with its business model in an effort to position itself to support the demand for a safe supply of cocaine.
Eby said the licence “is not part of our provincial plan,” referring to the ongoing effort to stem the overdose death rate, with an average of more than six people dying every day in B.C. in 2022.
B.C.’s drug decriminalization policy went into effect at the end of January, allowing individuals who are 18 and over to possess up to 2.5 grams of opioids, cocaine, methamphetamine and MDMA without criminal penalties.
The decriminalization is a three-year pilot project.
B.C. businesses are hiring a record number of temporary foreign workers as they struggle to fill jobs.
The latest federal data show there were more than 32,200 people in B.C. under the federal government’s Temporary Foreign Worker Program at the end of 2022, more than Ontario, which has more than twice B.C.’s population.
It’s a sign that companies—especially restaurants, farms, construction firms and retailers—are increasingly reliant on importing workers. They point to a tight labour market, with B.C.’s unemployment rate at 4.2% in December.
“It worries us, but in a good way,” Labour Minister Harry Bains said. “It means our economy is booming. It’s running on all cylinders, and we have more jobs than people available.”
The federal Temporary Foreign Worker Program allows Canadian businesses to hire foreigners for up to two years if they can demonstrate they were unable to hire a Canadian resident for the position.
Those employers are also required to register with the provincial Employment Standards Branch. In 2021, the branch received 2,955 applications from employers. In 2022 it received more than 12,300, more than 10,000 of them in the last four months of the year.
The surge is partially attributable to new federal regulations in September that urged businesses to register with provincial labour departments and follow their rules.
But industry representatives say there is growing demand for foreign labour, particularly in sectors like hospitality, construction and agriculture where companies are struggling to hire and retain staff.
Some industry associations say foreign workers have become vital to their businesses as they compete for employees in a tight labour market. Others, though, say they would much rather hire workers with a clear path to residency, unlike temporary workers who generally only stay in the country for one or two years. Critics of the program say workers are poorly paid and vulnerable to exploitation.
“The Temporary Foreign Worker Program often places workers in vulnerable positions, at the mercy of their employer,” BC Federation of Labour president Sussanne Skidmore said. “And the same is true of migrant and undocumented workers of all kinds, who play a critical role in key areas of our economy.”
Employment and Social Development Canada says there is growing demand for those workers because of the nation’s low unemployment rate. The program received more than 5,000 applications per month in October 2021, the department said. By November 2022, that was up to more than 8,000 applications a month.
In B.C., the program is often associated with agriculture, and farm workers make up the largest category of employee sought by companies.
But Glacier Media’s analysis of data from the first three quarters of 2022 also show mounting demand for cooks, carpenters, general labourers and retail assistants as those sectors struggle to find staff.
CALGARY — Experts say Teck Resources’ plan to separate its coal business from its base metals operations shows the influence of the sustainable finance movement.
The Vancouver-based mining company announced Tuesday that it will spin off its steelmaking coal assets to create a separate publicly traded company called Elk Valley Resources Ltd.
Teck Resources will become Teck Metals Corp., and will focus on the production of copper and zinc, two metals used in electric vehicle batteries and renewable energy installations.
Teck says the separation will offer investors choice between two unique businesses and commodity types.
Len Brooks with the University of Toronto’s Rotman School of Management says banks and other financial institutions are under increasing pressure from shareholders to make their lending policies for coal and fossil fuel companies more stringent and explicit.
He says Teck is likely hoping to shore up more positive investor support for its critical minerals business by separating it from its coal operations.
VICTORIA — Fisheries Minister Joyce Murray says the government will not renew licences for 15 open-net Atlantic salmon farms around B.C.’s Discovery Islands.
Murray says the Discovery Islands area is a key migration route for wild salmon, where narrow passages bring migrating juvenile salmon into close contact with the farms.
She said in a news release that recent science indicates uncertainty over the risks posed by the farms to wild salmon.
Open-net fish farms off B.C.’s coast have been a major flashpoint, with environmental groups and some Indigenous nations saying the farms are linked to the transfer of disease to wild salmon, while the industry and some local politicians say thousands of jobs are threatened if operations are phased out.
Murray said the decision came after extensive consultations with First Nations, the industry and others, and the department is taking a “highly precautionary” approach to managing salmon farming in that area.
She said there are multiple stressors on wild salmon, including climate change, habitat degradation and both regulated and illegal fishing.
VANCOUVER — Teck Resources Ltd. is evaluating alternatives for its steelmaking coal business, including the possible spin-out of an interest in that business to its shareholders.
The Vancouver-based company said Thursday that no decision has been reached to proceed with a transaction, and it can’t make any assurances that any kind of deal will happen, but that such a deal could be beneficial.
“Any transaction would be expected to create value for Teck’s shareholders and support continued benefits for communities and Indigenous Peoples in the areas where Teck operates,” the company said in a news release.
Teck made the comments at the request of the Investment Industry Regulatory Organization of Canada and the New York Stock Exchange after Bloomberg reported that the company was planning to spin out the division.
Teck’s shares jumped almost 10% on the news before they were halted mid-morning, while they were trading up $3.45, or 6.13%, at $59.70 in early afternoon.
The news appeared to be a reversal from Teck’s previous stance in using cash flow from its coal division to boost its copper growth pipeline and shareholder returns, said National Bank analyst Shane Nagle in a note.
“For management to shift its line of thinking, the value proposition from such a transaction may be more immediately accretive than we previously envisioned.”
Structuring a spinoff of the company’s coal assets will be challenging, with a simple asset sale unlike given the sheer scale of the business, said Nagle.
Spinning out the coal business while holding onto a large equity stake would be less tax advantageous, while currently elevated coal prices means a fair valuation for both parties would be difficult to agree upon, he said.
Steelmaking coal prices averaged US$278 per tonne in the company’s fourth quarter, compared with US$164 per tonne for 2019.
B.C.’s top bureaucrat says the government is embracing remote work in a bid to recruit and retain talent as it struggles to fill jobs.
Shannon Salter, deputy minister to the premier, sent a memo last week that “strongly encouraged” ministries to approve flexible work arrangements for employees who want them. It also included new guidelines outlining how those decisions should be made.
The memo also said new job postings will no longer be anchored to a single office or location and that employees are only required to live in a community where their ministry has an office.
Unions say that marks a major change in government’s approach to remote work after contract negotiations where the province resisted, including a right to work remotely in collective agreements.
Salter said the policy aims to bring diversity to the public service, and attract and keep employees who see in-person work as a dealbreaker.
The result could alter the nature of work for thousands of government workers and put more well-paying jobs in smaller communities—and change Victoria’s downtown, where many businesses rely on government workers’ business.
“Like other employers, we are experiencing a labour shortage at the B.C. public service,” Salter said Monday, without providing specific figures. “We’re looking for creative ways to ensure we continue to be the employer of choice.”
Few government employees worked remotely before 2020. Then the COVID-19 pandemic forced thousands of workers to move from big buildings in downtown Victoria to kitchen tables and home offices.
Some of those employees have since gone back to the office, but many others liked the change. The B.C. Finance Ministry estimates as many as 17,500 employees are still working remotely at least two days a week.
“It’s always been about life-work balance,” said Stephanie Smith, the president of the BC General Employees’ Union. Some workers prefer to skip the commute. Others can’t afford housing in Victoria or Vancouver.
“It’s about affordability, to be perfectly honest as well,” Smith said. “We’re seeing people move further and further and further away from where they actually work—members commuting from Chilliwack to Vancouver.”
Smith said remote work was a “huge issue” when the BCGEU and government bargained last year. Members wanted the right to work remotely in the contract, but Smith said the employer wouldn’t budge.
Employees currently need to get approval to work remotely. If they want to work remotely for more than two days a week, they need approval from either an assistant deputy minister or a designate, which is not always granted.