VICTORIA — British Columbia’s provincial budget sets a course for its largest-ever deficit of $13.3 billion in the 2026/27 fiscal year. That figure tops last year’s forecast by $3.1 billion and equals 2.9 percent of GDP, dwarfing the $5.6 billion shortfall during the 2020/21 COVID-19 crisis, which stood at 1.8 percent of GDP.

The Business Council of British Columbia slammed the budget for ignoring calls to rein in spending and support private investment ahead of the 2026 provincial budget. David Williams, the council’s vice president of policy, said B.C.’s finances have deteriorated rapidly as spending growth outstrips revenue gains. Households and businesses now face roughly $4 billion in tax increases over three years, he added, dealing another hit to private sector activity.

“We are profoundly disappointed to see major tax hikes at a time when British Columbians can least afford them,” Jairo Yunis, the council’s director of policy, said. Private sector employment in B.C. has grown just 6 percent since 2019, he noted, while public sector jobs surged 40 percent in the same period. The province also loses 50,000 to 70,000 residents yearly to other provinces—levels not seen since the mid-1970s and late 1990s. Yunis warned that the new taxes will likely accelerate out-migration and stifle business hiring.

Debt servicing costs represent the budget’s fastest-expanding expense, according to the council. Provincial finances appear headed for a fifth straight credit rating downgrade, which would drive up borrowing costs even further. “The current fiscal plan fails to stabilize the province’s finances,” Yunis stated.

Business leaders had urged restraint to improve conditions for investment and job creation. Instead, the budget projects deficits persisting through the forecast period. Revenue growth lags behind expenditures, with no clear path to balance outlined. Officials project the operating deficit will hit 2.9 percent of GDP next year before easing slightly in later years.

The tax measures target areas like payroll, speculation, and resource sectors, aiming to close the fiscal gap. Critics argue they penalize an economy already struggling with weak private sector momentum. B.C.’s unemployment rate hovers above the national average, and interprovincial migration drains skilled workers to Alberta and Ontario.

Williams highlighted how unchecked spending has eroded fiscal health. Per-person program spending in B.C. now exceeds pre-pandemic levels by wide margins, he said, even as population growth slows. The council called for targeted cuts and incentives to reverse the trends.

Government spokespeople defended the budget as necessary to protect services amid economic headwinds. They pointed to investments in health care, housing, and infrastructure as priorities. Still, the council’s analysis shows net debt climbing toward 50 percent of GDP by decade’s end.

As B.C. handles slow recovery, the budget’s trajectory raises fresh doubts about long-term stability. Private sector advocates demand bolder action to halt the slide.