Economic highlights

• B.C.’s economy is projected to see 1.5% real gross domestic product (GDP) growth in 2025, 1.3% growth in 2026 and return to solid average annual growth of 2.1% from 2027 until 2029.
• Strong year-to-date retail sales, steady employment gains and easing interest rates have supported B.C.’s economy despite weaker home sales and slower housing construction in 2025.
• Exports have also been volatile, influenced by developments in global demand in response to U.S. tariffs.
• Employment has increased by 1.1% year-to-date to August 2025.
• B.C.’s unemployment rate was among the lowest in the country at 6.2% in August 2025.

Operating results

• Revenue for 2025-26 is forecast to be $83.3 billion, $739 million below Budget 2025 projections.
• Lower revenue mainly reflects government’s decision to remove the consumer carbon tax, as well as lower natural resource revenues, and timing of federal contributions under the Disaster Financial Assistance Arrangements program.
• Revenue reductions are partly offset by higher corporate income tax revenues, and the inclusion of the one-time gain related to the tobacco settlement.
• Forecast natural resource revenue is down $225 million from budget, mainly due to lower commodity prices.
  • Natural gas royalties were down, forestry stumpage revenue was lower, coal and copper prices were weaker, and coal production was lower.
  • Revenue from electricity sales under the Columbia River Treaty is up $17 million as warmer than usual weather and drought created an increase in power demand and prices.
  • Revenues from other natural resources are up $31 million due to bonus bid cash sales and higher petroleum production values.
• Corporate income tax revenue is forecast to be $411 million higher than budget due to higher advance instalments from the federal government and an increase in prior year settlement payments mainly reflecting preliminary 2024 tax assessment results.
• Revenues include the estimated one-time net revenue of $2.7 billion in 2025-26 for the tobacco settlement.
  • The net revenue represents B.C.’s portion of the global award, net of legal costs and discounted due to the long-term nature of the payment schedule.
• Expenses are forecast to be $74 million lower than budget, due to:
  • Lower spending for refundable tax credits due to the elimination of the climate action tax credit, partially offset by higher projected spending funded by statutory authorizations, including an estimated $613 million for wildfires.
  • Debt servicing costs are forecast to be $140 million higher, due to a higher opening debt balance, higher interest rates, and accelerated timing of in-year borrowing.

Capital spending

• Taxpayer-supported capital spending on hospitals, cancer centres, housing, schools, transportation infrastructure and other projects is forecast to total $14.7 billion in 2025-26. This is $710 million lower than budget, due mainly to timing changes for major projects in procurement and construction of post-secondary, transportation and health sectors.
• A total of 18 major projects were approved since Budget 2025.
• Self-supported capital spending by Crown corporations is $10 million lower than at Budget 2025, due to changes in the timing of ICBC capital expenditures.

Debt levels

• Total provincial debt is projected at $155.4 billion by the end of the 2025-26 fiscal year.
• Debt-affordability metrics for the Province remain among the lowest in Canada, including the forecast for debt-to-GDP at 26.6% for 2025-26.

Expenditure management

• B.C. is on track to meet its initial expenditure management target of $1.5 billion over the fiscal plan through administrative savings, reductions in discretionary spending, freezing hiring and reviewing programs for efficiency.
• Expenditure management measures are expected to exceed the $300-million savings target in 2025-26.
• Government continues work on program efficiency reviews in advance of Budget 2026.