Report E: TAX EXPENDITURES

TABLE E2
ECONOMIC DEVELOPMENT AND BUSINESS ASSISTANCE PROGRAMS


TAX EXPENDITURE

1998/99
Estimated Cost


PROVINCIAL SALES TAX

($ millions)

Commissions paid to retailers and hotel operators 24
Exemptions for the following items:
Livestock for human consumption and agricultural feed, seed and fertilizer 35
Exempt purchases by farmers, fishers and aquaculturists 20
Magnetite for processing coal, eligible exploration equipment and drill bits for mineral exploration and production 2

 
FUEL TAX

Tax exemption for international flights carrying cargo 5
Tax exemption for family farm trucks (on road) 2

 
PERSONAL INCOME TAX

Venture capital tax credit 6
Employee venture capital tax credit 6

 
CORPORATION INCOME TAX

Provincial Measures
Film and video tax credit 10
Production services tax credit 13
International financial business tax refund1 4
Two-year corporate income tax holiday for small business 2

Federal Measures2

Earned depletion 3
Allowable business investment losses 4

 
CORPORATION CAPITAL TAX

Exemption for family farm and cooperative corporations 3
Two-year tax holiday for eligible British Columbia investment expenditures 22

 
SCHOOL AND RURAL AREA PROPERTY TAXATION3

School tax assessment reduction on current values for farm buildings and farm land, and residences in the agricultural land reserve 16
Assessment of farm land at farm use values4 84
Assessment exemption of $10,000 for industrial and business properties 6
Overnight tourist accommodation assessment relief 3
Managed forest land classification 8

 
OTHER TAXES

Oil and gas royalty holiday 6
 
1 Includes employee income tax refunds.
2 The provincial revenue loss estimates for federal measures are based on estimates of the federal losses contained in Government of Canada: Tax Expenditures, 1998. The federal estimates are based on 1998 estimated incomes. British Columbia corporate income tax expenditures are estimated by applying British Columbia's share of corporate taxable income to the federal estimates, and then applying the relevant tax rates. Certain tax expenditure items have been excluded where no data were available. (Prior to 1997, federal tax expenditure reports did not include projections; previous estimates of provincial revenue losses were based on historical federal estimates.)
3 Estimates are for the 1998 calendar year and include only school and rural area property taxes levied by the province.
4 Currently, the values of farm land and residential land in the Agricultural Land Reserve are reduced by 50 per cent for school tax purposes. The $84 million estimate assumes that farmland would be assessed at 100 per cent of market value.

 

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