Increase to corporate income taxes being considered13 January 2016
FREDERICTON (GNB) – One of the choices laid out in the document Choices to Move New Brunswick Forward is increasing income taxes for corporations to 14 per cent from 12 per cent. This increase could raise up to $25 million per year.
“As part of our review of every line of the government’s books we have identified hundreds of millions of dollars of potential savings,” said Health Minister Victor Boudreau, who is also minister responsible for the Strategic Program Review. “But New Brunswickers have made it clear that they want us to consider revenue options as well.”
“The Choices document includes a number of expenditure and revenue initiatives but choosing several of six key major initiatives will be necessary in order to get New Brunswick back on a secure fiscal foundation,” said Boudreau.
The six key initiatives are:
- rightsizing senior management in the civil service;
- reducing spending on health care;
- reducing spending on education;
- increasing the Harmonized Sales Tax;
- increasing the Corporate Income Tax; and
- introducing highway tolls.
Corporations with a taxable income greater than $500,000 pay a 12 per cent general corporate income tax rate. Newfoundland and Labrador has a general corporate income tax rate of 14 per cent, and Nova Scotia and Prince Edward Island have a rate of 16 per cent. Raising the rate by two percentage points would still leave New Brunswick tied for the lowest general corporate income tax rate in Atlantic Canada.
“Corporate income taxes are an important revenue stream and New Brunswickers have made it clear to us that this is an option that they want us to seriously consider,” said Boudreau.
The provincial government has committed to continue to consult New Brunswickers and then make decisions on the Strategic Program Review in time for the 2016 budget to be tabled in the legislative assembly on Feb. 2.