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VICTORIA — The British Columbia government is forecasting a growing budget surplus and economic growth that will lead Canada in the coming year despite dropping real estate tax revenues and declining property sales.

The latest budget update released Friday forecasts a budget surplus of $669 million, which is $450 million higher than was projected in February’s budget. Finance Minister Carole James said B.C.’s economic growth projections of 2.2 per cent this year and 1.8 per cent in 2019 are among the highest in Canada.

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James said she welcomed the most recent Finance Ministry data showing reduced revenues from property transfer taxes and sales declines since April.

“I truly believe B.C. has to move away from an economy that is built on speculation in real estate to a more sustainable approach,” she said at a news conference.

The financial update for the first three months of the fiscal year includes a decline in property transfer tax revenue of $250 million as property sales dropped by 19.4 per cent from April to June.