VICTORIA: The BC division of the Canadian Taxpayers Federation (CTF) today responded to the Economic and Fiscal Update with applause for the new business tax reductions as well as the previously-announced personal tax cuts but expressed concern about BC's spending levels.

"The new government has moved swiftly to end the 'age of ideology' and unroll the welcome mat for taxpayers and entrepreneurs," said CTF-BC director Mark Milke. "The reduction of personal and business taxes is welcome and sends a signal that British Columbia will encourage economic growth - the spin-offs of which are job creation, wage growth, and improved living standards."

Milke also noted that the government must still reduce personal taxes further as British Columbians at all income levels still pay more in personal income tax when compared with Alberta. "Provincial personal income taxes are not yet the lowest in the country according to the government's own figures released today; taxpayers look forward to more reductions in future years."

Milke expressed concern about the projected deficits and noted that the main cause of present and projected deficits is increased spending, while tax cuts are a smaller factor. "Governments don't borrow money for taxes they never collect; they borrow money for what they spend," said Milke.

Spending rises by $4.1 billion between Fiscal 1999 and Fiscal 2002

The Federation noted that direct government spending has increased by over $4.1 billion since 1999, from $20.6 billion in 1999 to a projected $24.7 billion this fiscal year, from $5,149 per capita in 1999 to $6,017 this year. Health expenditures are up by almost $2.2 billion in that period, while education expenditures are up by almost $1.1 billion since 1999.

"The government has delivered on tax cuts but spending - the main cause of BC's deficits - must be controlled as soon as possible," said Milke.