February 2017 Budget tax changes

Read a summary explanation of all the tax changes 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

The provincial sales tax on taxable electricity is being phased out. Effective October 1, 2017, the tax rate on electricity is reduced to 3.5% from 7% of the purchase price. Effective April 1, 2019, electricity is fully exempt from provincial sales tax.

Motor fuel and carbon tax

Effective October 1, 2017, natural gas for use in an internal-combustion engine for any rolling stock or vehicle when run on rails is exempt from the 3 cent per litre tax on locomotive fuel.

The motor fuel tax exemption for natural gas used as locomotive fuel is consistent with the motor fuel tax exemptions for natural gas used in motor vehicles or used in a ship.

Tobacco tax

Effective October 1, 2017, the tax rate on cigarettes is increased to $49.40 from $47.80 per carton of 200 cigarettes, and the tax rate on fine-cut tobacco is increased to 24.7 cents from 23.9 cents per gram. More information on the requirement to take an inventory of, and pay additional security on, unsold tobacco products held in B.C. as of midnight on September 30, 2017 will be provided at a later date.

Income taxes

Tax rates

Phase-out of preferential tax benefit for credit unions paused.

Small business corporate income tax rate reduced.

• Tax rates and business limits

Tax credits

New tax credit for volunteer firefighters and search and rescue volunteers introduced.

Education tax credit to end after the 2017 tax year.

Tax credit rate on the taxable amount of dividends (other than eligible dividends) reduced.

• Basic tax credits

New back to school tax credit introduced.

Book publishing tax credit extended.

• Book publishing tax credit

B.C. Mining flow-through share tax credit extended.

• B.C. Mining flow-through share tax credit

Film tax credits regional location boundary adjusted.

• Film and television tax credits
• Production services tax credit

Interactive digital media tax credit amended.

• Interactive digital media tax credit

Mining Exploration Tax Credit qualifying expenses expanded.

• Mining exploration tax credit (personal)
• Mining exploration tax credit (corporate)

Scientific research and experimental development tax credit extended.

• Scientific research and experimental development tax credit

Training tax credits extended.

• Training tax credit
• Training tax credit for employers

Property taxes

Property transfer tax

First time home buyers’ threshold increased.

• First time home buyers program

Historical budget information

• 2016 Budget tax changes