April 21, 2021
On April 20, 2021, BC’s Ministry of Finance released the 2021 Budget. A summary of the BC Budget highlights is provided below.
Personal Tax Measures
To align with the Federal change to the Canada Emergency Response Benefit (“CERB”), the Budget announced that self-employed individuals are not required to repay the BC Emergency Benefit for Workers if they would have qualified for the benefit or the CERB on their gross income.
Business Tax Measures
The mining flow-through share tax credit eligibility period during which an expenditure must be incurred by the issuer to be renounced in favor of flow-through shares is temporarily extended by 12 months. This extension applies to flow-through share agreements entered into between March 1, 2018 and December 31, 2020 when using the general rule, and agreements entered into in 2019 or 2020 when using the look-back rule.
Housing related measures announced in the Budget include the following:
- The property value threshold for the full home-owner grant is increased to $1.625 million in 2021 (from $1.525 million in 2020).
- Beginning in the 2021 tax year, corporations owned by agents of government can claim an exemption from the speculation and vacancy tax.
- A new exemption to the speculation and vacancy tax is provided for registered charities who hold property through a trust.
- The Speculation and Vacancy Tax Act is amended to clarify that a beneficial owner, whose interest in a residential property is registered in the name of a trustee of a trust and contingent on the death of another individual, is not considered a beneficial owner for the purpose of the speculation and vacancy tax.
Provincial Sales Tax Measures (“PST”)
PST related measures announced in the Budget include the following:
- Effective April 21, 2021, electric bicycles and tricycles are exempt from PST.
- Individuals who became a resident of BC on or after March 11, 2019 and who would otherwise qualify for the PST exemption in respect of personal effects brought into BC within one year of becoming a resident, will have until the earlier of January 1, 2023 or one year following the end of the most recent quarantine order made under the Quarantine Act (Canada), to bring their personal effects to BC without the application of PST.
- Effective on a date to be set by regulation, the PST refund for motor vehicles purchased in BC and sold within 7 days will be eliminated.
- Effective July 1, 2021, the tax rate on cigarettes and heated tobacco products will increase to 32.5 cents from 29.5 cents per cigarette or per heated tobacco product.
Other Tax Measures
- The book publishing tax credit is extended for five years to March 31, 2026.
- The climate action tax credit will increase to $193.50 per adult and $56.50 per child on July 1, 2022.
- Carbon tax rates will increase to $45 per tonne of CO2 on April 1, 2021 and to $50 per tonne of CO2 on April 1, 2022.
- Effective July 1, 2021, probate fees will not be charged on amount received by a person’s estate from the federal Memorial Grant Program for First Responders.
- Effective April 20, 2021, eligibility for the motor fuel tax refund for persons with disabilities is expanded to include recipients of disability assistance, or a disability supplement, from Indigenous Services Canada and anyone who is in receipt of 100% disability pension resulting from service as a member of Her Majesty’s forces.