ARTICLE · 24 FEBRUARY 2017

BC Budget Update - Corporate Tax Cut

Lawson Lundell LLP

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The small business corporate income tax rate will be reduced from 2.5% to 2% effective April 1, 2017.

CanadaTax

Gareth Williams

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Corporate Tax Rate

The small business corporate income tax rate will be reduced from 2.5% to 2% effective April 1, 2017. This means that the combined Federal and Provincial tax rate for small business income, up to $500,000 per year, will be 12.5% in British Columbia (subject, of course, to any changes coming in the Federal Budget).

The Government projects this measure to reduce tax revenue by approximately $70 million per year. Overall corporate tax revenue is between $3 and $3.5 billion per year; total provincial revenue is in the order of $50 billion per year.

Tax Credits Extended

The following tax credits have all been extended:

1) Scientific Research and Experimental Development Tax Credit – to August 31, 2022.

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