Latest BC Provincial Budget Tax Updates

August 18, 2023
by Jared Cross, C.P.A, C.G.A

Understanding and managing the changing tax landscape is vital for any successful business. Whether you’re a small startup or a well-established organization, understanding these updates is essential for making smart financial choices and capitalizing on new opportunities. Katrine Conroy, British Columbia’s finance minister, delivered the British Columbia Budget 2023 on February 28th, 2023, revealing that the Budget 2023 will focus on creating tax rebates and credits for health care, housing affordability, skills development, and clean technology & sustainability goals. Here are several updates highlighted from the BC Budget 2023*:

*This listing may not be comprehensive and is subject to change.

Income Taxes

B.C. Family Benefit

Starting from July 1, 2023, there’s a permanent increase in B.C. family benefit amounts, providing families with additional funds to assist with their household expenses:

  • $145.83 per month for your first child
  • $91.67 per month for your second child
  • $75 per month for each additional child

If your adjusted family net income exceeds $27,354 but falls below $87,533, the benefit you’ll receive will be elevated to a minimum of:

  • $64.58 per month for your first child
  • $62.50 per month for your second child
  • $60.41 per month for each additional child

Climate Action Tax Credit

Starting from July 1, 2023, the B.C. climate action tax credit amounts will be raised to combat the expenses that can arise due to the impacts of a shifting climate, such as increased electricity bills. For July 2023, October 2023, January 2024 and April 2024 payments, the maximum annual amounts increase to:

  • $447 for you
  • $223.50 for your spouse or common-law partner (or for the first child in a single-parent family)
  • $111.50 for each child (except the first child in a single-parent family)

The threshold amounts increase to:

  • $39,115 for individuals
  • $50,170 for families

B.C. Renter’s Tax Credit

Starting for the 2023 tax year, a new refundable B.C. renter’s tax credit is being introduced to provide assistance to low- and moderate-income renters. To receive the credit, you must file your 2023 T1 Income Tax and Benefit Return. Administered by the Canada Revenue Agency (CRA) for the province, you will receive up to $400 per year if:

  • You rent in B.C. for at least six months of the calendar year
  • Your adjusted net income is $60,000 or less. If your income is between $60,000 and $80,000, you will receive a reduced credit amount
  • Rent is paid on an eligible rental unit
  • On December 31 of the tax year, you’re a B.C. resident and:
    • 19 years of age or older, or
    • A parent, or
    • Cohabiting with a spouse or common-law partner

Farmers’ Food Donation Tax Credit

The farmers’ food donation tax credit is extended to the end of 2026 to maintain its role in incentivizing farmers and farming corporations to donate agricultural products cultivated in B.C. to registered charities, including food banks and school meal programs.

Interactive Digital Media Tax Credit

B.C. is the third largest film and television destination in North America. The interactive digital media tax credit is extended to August 31, 2028.

Property Taxes

Property Transfer Tax

Commencing January 1, 2024, those purchasing a new qualifying purpose-built rental building may qualify for an exemption from the further 2% property transfer tax on the amount of the residential property value that exceeds $3,000,000.

Sales Tax

Provincial Sales Tax (PST)

Starting March 1, 2023, automated external defibrillators (AEDs) are exempt from PST. Kits containing AEDs, and parts and services for AEDs, including pads, are also exempt from PST.

Carbon Tax

Carbon Tax Rates

As of April 1, 2023, carbon tax rates are increased by $15 per tonne of carbon dioxide equivalent emissions (CO2e) annually until reaching $170 per tonne of CO2e in 2030. Click here to find more information on the carbon tax rates by fuel type.

Carbon Tax on Natural Gas and Propane for Greenhouse Growers

Starting April 1, 2023, eligible commercial greenhouse growers have the opportunity to apply for a point-of-sale reduction on carbon taxes. This reduction applies to the purchases of natural gas and propane, specifically used for heating and producing carbon dioxide (CO2) to enhance crop productivity.

The reduced tax applies to greenhouse growers who grow vegetables, fruits, bedding plants, flowers, ornamental plants, tree seedlings or nursery landscape plants. To qualify, greenhouse growers must:

  • Grow the crops identified above and generate gross revenues of $20,000 or more in the previous 12 months, and
  • Have a reasonable estimate that revenues will be $20,000 or more during the next 12 months

Motor Fuel Tax

International Fuel Tax Agreement

Effective April 1, 2023, the refund rates for International Fuel Tax Agreement licensees increase to align with the carbon tax rates.

Have questions? Our Accounting Firm Has Answers

The British Columbia Budget 2023 outlines what BC businesses can expect in 2023. If you have any questions or need further information about the tax updates, how they might impact your business, and how you can benefit from these initiatives, our accountants at Cross & Company are here to help. As a local accounting firm in Nanaimo, BC, we proudly serve Ladysmith, Parksville, Qualicum, Port Alberni, Duncan, and Lake Cowichan.