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
 |
dividend tax credit reduced to 3.4% of taxable
dividend, effective January 1, 2010. |
|
small 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
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to 10.5% effective January 1, 2010 |
|
to 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
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:
|
$37.00 per carton of 200 cigarettes from $35.80 |
|
18.5¢ 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 Budget
2009 Tax Change Summary (pdf).
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
Business tax
| Effective 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. |
| Corporate 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:
Revised: April 22, 2010
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