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BC 2009 Budget

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British Columbia-> Budget 2009

British Columbia 2009 Budget - February 17, 2009

Personal tax

Dividend tax credit (DTC) rates

It is proposed to reduce the regular (small business) dividend tax credit rate

bulletdividend tax credit reduced to 3.4% of taxable dividend, effective January 1, 2010.
bulletsmall business dividend tax credit rate was previously reduced for 2009 to 4.2% from 5.1% of taxable dividends

The enhanced dividend tax credit rate for eligible dividends was previously reduced, effective January 1, 2009, to 11% from 12% of taxable dividends.  No further changes were announced in the 2009 Budget.

See the BC Dividend Tax Credit page for a table showing the revised combined federal/BC marginal tax rates for eligible dividends when the BC dividend tax credit rate reduction and personal tax rate reductions are combined with the federal reduction of the dividend gross-up, and the changes in the federal dividend tax credit rate.

 

BC mining flow-through share tax credit (MFTS)

It is proposed to extend the MFTS to the end of 2009, retroactive to January 1, 2009.

The MFTS provides a non-refundable tax credit equal to 20% of BC flow-through mining expenditures.

See the BC Small Business and Revenue page  Tax Credits - British Columbia Mining Flow-Through Share Tax Credit.

 

Corporate income tax

It is proposed to reduce the general corporate income tax rate

bulletto 10.5% effective January 1, 2010
bulletto 10% effective January 1, 2011

There is no proposal to reduce the small business corporate tax rate, which was reduced from 3.5% to 2.5% effective December 1, 2008.

See the  BC Small Business and Revenue website for changes to

bulletFilm and Television Tax Credit - eligibility expansion for this refundable tax credit
bulletProduction Services Tax Credit - relaxation of requirements for this refundable tax credit
bulletLogging Tax Credit - partial remission

 

Provincial sales taxes (PST)

The budget announced the extension of some temporary PST exemptions and introduction of some new temporary exemptions.  See the Small Business and Revenue web page Budget 2009 - Consumer Taxes for more information.

 

Property Tax

Northern and Rural Homeowner benefit

A benefit of up to $200 per homeowner will be provided in 2011 to homeowners in areas outside the Capital, Greater Vancouver and Fraser Valley regional districts.  Based on the current forecast of carbon tax revenues for 2011/12 the Northern and Rural Homeowner benefit is expected to be $200 per homeowner.

Industrial Property Tax Credit

The Industrial Property Tax Credit will be increased to 60% from 50% for the 2011 tax year

School Property Tax

School property taxes for land classified as farm will be reduced by 50% for the 2011 tax year.

 

Tobacco Tax

Tobacco tax rates have been increased effective February 18, 2009 to:

bullet$37.00 per carton of 200 cigarettes from $35.80
bullet18.5¢ per gram of loose tobacco from 17.9¢

See the Small Business and Revenue web page Budget 2009 - Consumer Taxes for more information.

 

All of the tax changes in the 2009 Budget are subject to legislative approval.

For further information see the BC Government Budget website, and the Tax Measures - Supplementary(pdf) starting on page 64 (pdf page 72) of the Budget and Fiscal Plan.

 

BC Budget Update - September 1, 2009

Medical Service Plan (MSP) Premiums

Maximum monthly premium rates will increase by $3 per month ($36 per year) for single persons and $6 per month ($72 per year) for families.  However, the adjusted net family income thresholds are increased by $2,000 each.  As a result, individuals and families with adjusted net income of $30,000 or less will have lower premiums effective January 1, 2010.  See the new premium table on our MSP page.

Personal tax

bulletTax credit changes effective January 1, 2010:
bulletbasic personal amount is increased to $11,000
bulletspousal amount and eligible dependent amount are increased to $9,653 (reduced when spousal income exceeds $965)
bulletBC mining flow-through share tax credit (BC MFTS) expiry date is extended for an additional year, to December 31, 2010.

Business tax

bulletEffective July 1, 2009, the Basic Training Tax Credit for employers is increased from 10% of wages (up to $2,000 per apprentice) to 20% of wages (up to $4,000 per apprentice).  See BC Finance Ministry information on Training Tax Credits.
bulletCorporate income tax - effective January 1, 2010, the small business limit is increased to $500,000.

Harmonized Sales Tax (HST)

British Columbia intends to harmonize its provincial sales tax (PST) with the Federal goods and services tax (GST) effective July 1, 2010.

The current PST rate in BC is 7%, which, when combined with the GST will result in a harmonized sales tax (HST) rate of 12%.

In the Budget Update, the provincial government announced that it also proposes to provide a provincially administered HST exemption for residential energy use.  This was included in their HST backgrounder (pdf) document.

The change to HST will mean a significant savings and boost in productivity for businesses in BC.  See our BC HST page for more information.

Further information on the BC Government website regarding the September 2009 Budget Update:

bulletSeptember Budget Update 2009
bulletBudget-Related Taxation Information - September Budget Update 2009

 

Revised: September 19, 2017

 

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