April 3, 2020
COVID-19 Action Plan: Tax Changes Announced by The Provincial Government
On March 23, 2020, the British Columbia government announced provincial tax changes as part of its COVID-19 Action Plan. The following tax changes were announced:
Deferral of the Employer Health Tax Filings and Payments
Effective on March 23, 2020, employers can defer their employer health tax payments until September 30, 2020.
The employer health tax applies to employers and their associated employers with a payroll of over $500,000. Employers with a payroll below the threshold are already exempt from the employer health tax.
Deferral of Other BC Tax Filings and Payments
The BC government has extended the filing and payment deadline for the following sales taxes until September 30, 2020:
Provincial sales tax
Municipal and regional district tax on sales of short-term accommodations
Carbon tax
Motor fuel tax; and
Tobacco tax.
Delayed Budget 2020 Tax Changes
On April 1, 2020, the carbon tax was set to increase to align the carbon tax rates with the federal carbon tax rates. This increase has been postponed until further notice.
Additionally, the provincial sales tax on carbonated beverages containing sugar, natural sweeteners or artificial sweeteners will be postponed until further notice along with the new provincial sales tax registration requirements for e-commerce businesses.
Reduced School Tax Rates for Businesses
The school tax rate for commercial properties (business, light-industry and major-industry properties) will see a reduction of 50% on their school taxes for 2020.
Enhanced BC Climate Action Tax Credit
An additional tax- free payment of $1,000 will be available to British Columbians whose ability to work has been affected as a result of COVID-19. This one-time payment will be made in July 2020 on top of the regular climate action tax credit amount that is available to qualifying individuals and families. The benefit will be paid to British Columbians who receive federal Employment Insurance, or the new federal Emergency Care Benefit or Emergency Support Benefit. British Columbians eligible include:
Workers who have been laid off;
Individuals who are sick or quarantined;
Parents with sick children;
Parents who work from home while child care centres and schools are closed; and
Individuals caring for sick family members, such as an elderly parent.
The above content is believed to be accurate as of the date of posting. Canadian tax laws are complex and are subject to frequent changes. Professional tax advice should be sought before implementing any tax planning. Manning Elliott LLP cannot accept any liability for the tax consequences that may result from acting based on the information contained herein.