Legislation introduced to eliminate MSP premiums in B.C. by Jan. 1, 2020

The B.C. government has officially introduced legislation that would see Medical Services Plan (MSP) premiums gone as of Jan. 1, 2020. 

"After years of MSP premium increases, our government is proud to be moving forward in meeting our promise to end this regressive tax," Adrian Dix, Minister of Health, says in a news release. "Through this legislation, our government will eliminate MSP premiums in January 2020 and make life more affordable for British Columbians. Eliminating MSP premiums will save individuals up to $900 a year and families as much as $1,800 a year."

Currently, B.C. is the only Canadian province to still charge a monthly health-care premium. 

The Medicare protection amendment act, 2019, would remove the sections related to MSP premiums as well as premium assistance from the Medicare Protect Act, ensuring that MSP beneficiaries do not have to pay any new premiums for enrolment periods after Jan. 1, 2020. 

"Eliminating MSP premiums is one of the largest tax cuts for people in B.C.'s history — and one that was long overdue," Carole James, Minister of Finance adds. "This is just the beginning of how we're making life more affordable for people. Whether it's putting more money in families' pockets through the BC Child Opportunity Benefit or eliminating interest on B.C. student loans, we're making choices that put people first."

The first step of getting rid of MSP premiums was announced back in the 2017 Budget, with a 50 per cent cut. 

The MSP program will still have the same health-care benefits currently available with no changes announced. 

While premiums will be phased out for individuals, businesses are set to be footing the bill. 

As of Jan. 1, 2019, the employer health tax came into effect. 

Employers with B.C. remuneration of under $500,000 or less do not have to pay the employer health tax. 

Between $500,000.01 and $1,500,000 (notch rate amount) pay the reduced tax amount as calculated: 2.925 per cent times (B.C. remuneration - $500,000).

Greater than $1,500,000 pay the tax on their total B.C. remuneration as calculated: 1.95 per cent times total B.C. remuneration. 

If a business is required to pay instalments in the calendar year of 2019, the deadline to register is May 15, 2019, as a first payment is due June 15, 2019.

Dec. 31, 2019, is the deadline to register for all other taxable employers while March 31, 2020, will be the deadline to file and pay your first return.