2021 Budget tax changes
Publication date: April 22, 2021On April 20, 2021, the government announced changes to the provincial tax laws.
Read a summary explanation of all the tax changes for Budget 2021 in the Budget and Fiscal Plan.
Changes were introduced for:
Learn more about the following tax changes using the sources below.
Sales taxes
Provincial sales tax
Exemption for electric bicycles and tricycles
Effective April 21, 2021, electric bicycles and tricycles are exempt from provincial sales tax (PST). In addition, conversion kits used to electrify conventional bicycles and tricycles, and parts and services for electric bicycles and tricycles, are exempt from PST. The following bulletin has been updated to include this information:
- Bulletin PST 204, Bicycles and Tricycles (PDF, 294KB)
Exemption for new resident’s effects temporarily expanded
Effective March 11, 2019, the exemption for a new resident’s effects is expanded to provide more time for new residents to bring their vehicles and other goods into B.C. without being subject to PST. The following bulletins have been updated to include this information:
- Bulletin PST 306, Goods Brought Into BC by New Residents (PDF, 395KB)
- Bulletin PST 308, Vehicles (PDF, 439KB)
PST refunds on motor vehicles
Effective on a date to be set by regulation, the provincial sales tax refund for motor vehicles purchased in B.C. and resold within seven days will be eliminated. Concurrently, persons who purchase vehicles in B.C. will be deemed to have purchased the vehicles for their own use, and not for resale, unless they represent otherwise to the seller at the time of purchase.
Provincial Sales Tax Act amendments
The Provincial Sales Tax Act is also amended:
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Effective April 1, 2021, to clarify that the exemption for water does not apply to beverages taxed under the soda beverage measures announced in Budget 2020
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Effective on royal assent and on a date to be specified by regulation, to make minor changes in terminology to provisions related to multijurisdictional vehicles
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Effective on royal assent, to clarify that an agent is authorized to use the registration number of their principal when acting on their behalf
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Effective April 1, 2021, to make minor clarifications to provisions related to registration thresholds for Canadian sellers of goods, along with Canadian and foreign sellers of software and telecommunication services
Motor fuel tax and carbon tax
Fuel tax refund program for persons with disabilities
Effective April 20, 2021, the Fuel Tax Refund Program for Persons with Disabilities is expanded to include persons who receive:
- Disability assistance or a supplement from Indigenous Services Canada through the Social Assistance for Persons with Disability program
- A 100% disability pension through service as a member of Her Majesty’s forces, whether or not they served in a war
The following bulletin and webpage have been updated to include this information:
- Bulletin MFT 004, Fuel Tax Refund Program for Persons with Disabilities (PDF, 277KB)
- Fuel tax refund program for persons with disabilities
Carbon tax
As announced on September 2, 2020, carbon tax rates are set at $45 per tonne of carbon dioxide equivalent emissions (CO2e) effective April 1, 2021. Rates will increase to $50 per tonne of CO2e on April 1, 2022. The following bulletin has been updated to include this information:
- Bulletin MFT-CT 005, Tax Rates on Fuels (PDF, 286KB)
Tobacco tax
Effective July 1, 2021, tobacco tax rates will increase for:
- Cigarettes from 29.5 cents per cigarette to 32.5 cents
- Heated tobacco products from 29.5 cents to 32.5 cents per heated tobacco product
- Loose tobacco from 39.5 cents per gram to 65 cents per gram
More information on the requirement to take an inventory of and pay additional security on tobacco held in inventory at 12:01 am on July 1, 2021, will be provided at a later date.
Income taxes
Tax credit filing deadline extension
Effective March 13, 2020, the deadline to file the following tax credits is extended to the earlier of December 31, 2020 and six months from the original filing deadline:
- Book publishing tax credit
- Film tax credits
- Interactive digital media tax credit
- Mining exploration tax credits
- Scientific research and experimental development tax credit
- Shipbuilding and ship repair industry tax credit
- Training tax credits
Personal tax credits
Effective July 1, 2021, the climate action tax credit rate remains at $174 per adult and $51 per child due to the delay in the carbon tax rate increases. Rates will increase to $193.50 per adult and $56.50 per child on July 1, 2022, in line with the corresponding carbon tax rate increase.
As previously announced, the mining flow-through share tax credit eligibility period during which an expenditure must be incurred by the issuer to be renounced in favour of flow-through shares is temporarily extended by 12 months.
Corporate tax credits
As announced on March 10, 2021, the book publishing tax credit is extended for five years to March 31, 2026.
B.C. Emergency benefit for workers
Budget 2021 proposes to provide repayment relief for self-employed individuals who received the Emergency Benefit for Workers if they would have qualified for the Emergency Benefit for Workers or the Canada Emergency Response Benefit based on their gross income. This mirrors a federal change to the Canada Emergency Response Benefit.
See B.C. emergency benefit for workers for more information about this update.
Property taxes
Effective April 20, 2021, the Property Transfer Tax Act is amended to restrict a taxpayer’s choice of arbitration to disputes about the fair market value portion of an assessment. Arbitration is only available after an appeal to the minister.
For more details about this information, see the following resources:
- Appeal further
- Bulletin GEN 002, Appeals (PDF, 210KB)
Speculation and vacancy tax
The Speculation and Vacancy Tax Act is amended:
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Effective on royal assent, to update references to the CRA income tax return form to match the new CRA line numbers
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Effective on royal assent, to exempt wholly-owned subsidiaries of a government agent from the speculation and vacancy tax
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Effective on royal assent and retroactive to November 27, 2018, to not include a beneficial interest contingent on the death of another individual in the definition of “beneficial owners”
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Effective on royal assent and retroactive to November 27, 2018, to provide a speculation and vacancy tax exemption to a person who owns the property as a trustee of a trust for the benefit of a registered charity
Various acts
Administrative provisions are provided for the following tax programs:
- B.C. Recovery benefit effective December 18, 2020
- B.C. Increased employment incentive effective March 30, 2021
Appeals may be accepted for certain decisions made in the following programs:
- B.C. Emergency benefit for workers
- B.C. Recovery benefit
- B.C. Increased employment incentive
For details, see Bulletin GEN 002, Appeals (PDF, 210KB).
Effective on royal assent, the acts listed below are amended to harmonize appeal procedures with the Court of Appeal Act. This will allow parties to appeal a Supreme Court of British Columbia decision without having to first obtain leave of a justice of the Court of Appeal:
- Carbon Tax Act
- Employer Health Tax Act
- Forest Act
- Income Tax Act
- Insurance Premium Tax Act
- International Business Activity Act
- Logging Tax Act
- Mineral Tax Act
- Motor Fuel Tax Act
- Property Transfer Tax Act
- Provincial Sales Tax Act
- Speculation and Vacancy Tax Act
- Tobacco Tax Act