Tax Cuts Funded by the Carbon Tax
B.C.’s revenue-neutral carbon tax has allowed British Columbia to reduce taxes for individuals, families and business.
Since the carbon tax was introduced on July 1, 2008, some $306 million has been collected. However, the corresponding tax cuts have returned over $313 million to British Columbians. That is $7 million more in British Columbian pockets thanks to the revenue neutral tax on carbon emissions.
As a result, B.C. now has the lowest income tax rates in Canada for people earning up to $118,000, B.C.’s corporate taxes will be the lowest in the G7 group of countries, and B.C.’s small business tax rates will be the lowest in Canada by 2012.
These tax cuts will attract investment, create jobs and put more money in people’s pockets.
British Columbians will continue to benefit from the following tax reductions funded entirely by the new revenue-neutral carbon tax.
|
| Tax Reductions Funded by the Revenue Neutral Carbon Tax |
($millions) |
2009/10 |
2010/11 |
2011/12 |
Total |
Carbon tax revenue (amount to be returned to taxpayers)
|
(557)
|
(748)
|
(955)
|
(2260)
|
| Personal Tax Cuts |
|
|
|
|
| – Low income refundable tax credit |
151 |
150 |
150 |
455 |
| – Increase low-income tax credit by 10 per cent in July 2011 |
- |
- |
12 |
12 |
| – Reduce first two tax bracket rates by 5 per cent |
208 |
216 |
228 |
652 |
| – Provide a northern and Rural Homeowner benefit of up to $200 effective 2011 |
- |
20 |
83 |
103 |
Total tax cuts for individuals
|
359
|
386
|
473
|
1218
|
| Business Tax Cuts |
|
|
|
|
| – General corporate income tax rate cut to 11% effective July 1, 2008, to 10.5% effective Jan. 1, 2010 and to 10% effective Jan. 1, 2011 |
194 |
238 |
286 |
718 |
| – Small business corporate income tax rate cut to 3.5% July 1, 2008 and to 2.5% effective Dec. 1, 2008 |
202 |
161 |
191 |
554 |
| – Industrial Property Tax Credit of 50% of school property taxes payable by light and major industrial properties |
54 |
55 |
57 |
166 |
| –Increase the Indistrial Property Tax Credit to 60% proposed for 2011 |
- |
3 |
11 |
14 |
| – Reduce school property taxes by 50 per cent for land classified as 'farm' |
- |
1 |
2 |
3 |
Total tax cuts for businesses
|
450
|
458
|
547
|
1455
|
Total tax cuts |
809 |
844 |
1020 |
2673 |
|
|
