Willow Creek day care in Terrace may soon need to turn parents away. Owner Jennifer Maillet says the child care facility will be required to pay the province’s new payroll tax next year, to a tune of $15,000 a year.
“The difference in the cost, I’m not sure yet, it will probably mean reduction in infant/toddler spaces, because infant/toddler spaces cost our centre money to operate,” said Maillet.
Right now, the child care is run out of a school that is leased from the local school district. Willow Creek has a payroll of $850,000 a year, which is above the $500,000 a year threshold where businesses will be exempt from the new tax.
WATCH BELOW: B.C. finance minister announces MSP premiums will be replaced by 2020
The B.C. NDP introduced the payroll tax in order to get rid of Medical Service Plan premiums. Companies with payrolls over $500,000 will start paying the tax next year, and MSP will be gone by 2020.
Maillet currently has a staff of 40 people and has 144 child care spaces. Those include spots for toddlers, preschoolers, group child care and after school care. The owner is looking at space reductions, because she does not want to do anything that would reduce the quality of care.
The elimination of the MSP is part of the NDP government’s overall plan to address affordability. That plan also includes a new benefit of up to $1,250 per child per month. Families earning under $45,000 per year will be eligible for the full amount, while those earning under $111,000 will benefit on a sliding scale.
The NDP says the plan will apply to up to 86,000 families by the time it’s fully implemented in 2021.
The benefits will be paid directly to eligible licensed service providers and will replace the existing child care subsidy offered under the BC Liberals.
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“I think the province has good intentions, but the first step is to be supporting day cares that already exist,” said Maillet. “Where the crisis really is are ECEs and fair wages.”
WATCH BELOW: BC municipalities will also have to pay the new payroll tax
B.C. Liberal critic Laurie Throness has asked the provincial government to exempt daycares from the new health tax. At this point the government has committed to at least having a conversation with child cares, non-for-profits, charities and other groups who are frustrated with the new tax.
“We are going to have discussions with groups and organizations,” said NDP Finance Minister Carole James. “In 2020 they will be saving 100 per cent of MSP if they are paying it.”
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