Pulp mills like Harmac near Nanaimo would benefit from a break on their substantial power bills.

BC BUDGET: PST relief proposed for business electricity bills

Sales tax on power bills not only hits business, it's also charged on hospitals, schools and municipalities

Finance Minister Mike de Jong has accepted the advice of a business advisory group, proposing to take the provincial sales tax off business electricity bills over the next two years.

In his pre-election budget Tuesday, de Jong announced a plan to cut the PST on electricity in half effective Oct. 1, from seven per cent to 3.5. The rest would be removed in April 1, 2019.

Residential and farm power bills are already exempt from PST. Municipalities, hospitals and schools pay PST on their electricity purchases and would benefit from the change.

De Jong set up a Commission on Tax Competitiveness last year, and it identified B.C. as the only jurisdiction in North America that applies sales tax to electricity bills.

In January, mayors of North Cowichan, Quesnel, Vernon, Port Alberni, Mackenzie, Powell River, Taylor and Port Alice wrote to de Jong asking for the measure to assist struggling sawmills and pulp mills.

“It’s good news for the pulp and paper industry, good news for our workers and communities,” said Len Posyniak, senior vice president of Catalyst Paper. “We’re BC Hydro’s largest industrial user, and we make up about five per cent of the load.”

The province currently takes in about $164 million a year from the tax. The finance ministry estimates that the elimination would save small and medium-sized businesses about $50 million a year.

The budget also proposes to reduce the small business income tax rate by half a point to two per cent. De Jong said that puts B.C’s small business tax at the second lowest rate in Canada, behind Manitoba which has no income tax on small business.

 

Just Posted

Saanich councillor fears weed could crowd out food as greenhouses convert

Head of provincial association representing greenhouse vegetable farmers not worried about issue

Experience automotive classics and more at the Vancouver Island Concours d’Elegance

Motorcar Weekend features Show and Shine, high-end Concours division, all for a great cause

Langford veteran rehab program takes multi-tiered approach to treating pain

Clinic ‘bio-psycho-social approach to healing’ from Victoria to the West Shore earlier this year

Stem cell donor with rare genetic makeup needed to save Saanich man after cancer returns

Jeremy Chow is half Canton Chinese, half British and needs a donor with a similar ethnic background

Disney Plus to launch in Canada in November

Analysts say latest streaming service may escalate cord cutting

B.C. manhunt suspects left cellphone video before they died: family

Family member says Kam McLeod, Bryer Schmegelsky recorded final wishes

Okanagan bus driver assaulted for asking patron not to smoke

59-year-old in hospital with non-life threatening injuries

B.C. sets rules for ride hailing, same minimum fee as taxis

Larger operating areas seen as threat by cab companies

Two hiking families team up to extinguish fire in B.C. backcountry

Children and their parents worked for three hours to ensure safety of the popular hiking region

Police seek tips in 2015 death of Island teen Brown

Four years has passed since the body of Penelakut Island woman was discovered

Vancouver man arrested after pregnant woman’s SUV stolen, then crashed

Police are recommending charges against a 22-year-old Vancouver man

Elections Canada to assess ‘partisan’ climate change rhetoric case by case

People’s Party of Canada Leader Maxime Bernier has said climate change is not an emergency nor caused by human

Most Read