BC Budget Summary 2016

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Below is a summary of some select changes proposed in BC Budget 2016:
  • BC Training and Education Savings Grant – To help even more parents and families save early for their child’s education, Budget 2016 extends the program to children born on or after January 1, 2006. Previously the program was only available to children born on or after January 1, 2007. The program allows parents to apply at participating financial institutions for a $1,200 grant when their child turns 6 years old. The grant is a one-time payment of $1,200 for every eligible BC resident child born since January 1, 2006, and will be transferred to the child’s registered education savings plan
  • Temporary Top Personal Income Tax Rate expired as promised – A temporary tax rate was introduced for the 2014 and 2015 tax years of 16.8% on taxable income over $150,000. This two-year temporary measure was set to expire December 31, 2015, resulting in BC’s top tax rate being reduced back down to 14.7% on income over $106,543. For 2016, BC tax rates are as follows:
    • Income between $106,544 to $140,388 – 40.7%
    • Income between $140,389 to $200,000 – 43.7%
    • Income above $200,000 – 47.7% (results from Federal Liberal 4% increased top tax bracket)
  • BC Tax Reduction Credit – Effective 2016 the phase out rate was increased to 3.56% of net income, and the credit phase-out threshold was increased to $19,400
  • BC Seniors’ Home Renovation Tax Credit expanded to persons with disabilities
  • Federal Changes to Taxation of Trusts and Estates have been paralleled
  • Property Transfer Tax exemption – Effective for purchases after February 16, 2016, this exemption reduces or eliminates the amount of property transfer tax on the acquisition of newly built homes with a fair market value under $800,000
  • Support for Rural Communities – To help rural communities reinvigorate and diversify their economies, BC is investing $75 million over three years to the Rural Dividend Program. To recognize the importance of public transportation, BC is investing $7 million to expand service in BC Transit’s operating area
  • BC Mining Flow-Through Share Tax Credit – Extended to end of 2016
  • Medical Services Plan Premiums Increased – Premiums are increased about 4% effective January 1, 2017, as well the rate structure is significantly changed resulting in savings for certain families
  • PST – The minister announced a commission on tax competitiveness to “consider ways to modernize the existing tax structure, given the changing economy.” However, it was noted that the “scope of work will explicitly exclude consideration of a harmonized sales tax”