Pulp mills like Harmac near Nanaimo would benefit from a break on their substantial power bills.

BC BUDGET: PST relief proposed for business electricity bills

Sales tax on power bills not only hits business, it's also charged on hospitals, schools and municipalities

Finance Minister Mike de Jong has accepted the advice of a business advisory group, proposing to take the provincial sales tax off business electricity bills over the next two years.

In his pre-election budget Tuesday, de Jong announced a plan to cut the PST on electricity in half effective Oct. 1, from seven per cent to 3.5. The rest would be removed in April 1, 2019.

Residential and farm power bills are already exempt from PST. Municipalities, hospitals and schools pay PST on their electricity purchases and would benefit from the change.

De Jong set up a Commission on Tax Competitiveness last year, and it identified B.C. as the only jurisdiction in North America that applies sales tax to electricity bills.

In January, mayors of North Cowichan, Quesnel, Vernon, Port Alberni, Mackenzie, Powell River, Taylor and Port Alice wrote to de Jong asking for the measure to assist struggling sawmills and pulp mills.

“It’s good news for the pulp and paper industry, good news for our workers and communities,” said Len Posyniak, senior vice president of Catalyst Paper. “We’re BC Hydro’s largest industrial user, and we make up about five per cent of the load.”

The province currently takes in about $164 million a year from the tax. The finance ministry estimates that the elimination would save small and medium-sized businesses about $50 million a year.

The budget also proposes to reduce the small business income tax rate by half a point to two per cent. De Jong said that puts B.C’s small business tax at the second lowest rate in Canada, behind Manitoba which has no income tax on small business.


Just Posted

Influx of funding means new projects, upgrades coming to Bella Coola and Central Coast

The Central Coast Regional District confirmed it will be receiving just over $6 million in funding

Three percent accommodation tax approved for Bella Coola accommodation providers

Only fixed-room accommodation providers with four rooms or more are required to charge the tax.

U.S. consulate general to visit Northwest

Trip part of the region’s first-ever pop-up consul for American residents

B.C.’s north heats up to record highs

Bella Bella, Masset, Prince Rupert and the Cassiar Area all broke records

Sealed DNA in Phillip Tallio murder case must be released, orders Judge

A unanimous decision by B.C. Court of Appeal judges has ordered the release of a sealed DNA sample

Vancouver Aquarium’s resident octopus released into ocean

Staff let the Giant Pacific octopus go into the waters near Bowen Island so she can reproduce

Canucks sing the Blues as they fall to St. Louis 4-1

Berglund nets two, including the game-winner, to lift St. Louis over Vancouver

Calving season brings hope for Cariboo ranchers

Still a lot of work ahead to recover from the wildfires

Canada’s Kaetlyn Osmond wins figure skating world title

The 22-year-old fwon the women’s singles crown with her Black Swan routine

B.C. pooches celebrate National Puppy Day

Check out some of the submissions from around B.C. for National Puppy Day 2018

Alberta tells B.C. to stop opposing pipelines if it doesn’t like gas prices

John Horgan said he would like to see the federal government step in to deal with high gas prices.

B.C. mother hit in truck rampage dies

Family confirms mother of four Kelly Sandoval dies almost two months after being hit.

Walking from Argentina to Alaska

Holly ‘Cargo’ Harrison is now in northern B.C. on his journey from Argentina to Alaska.

PHOTOS: Students exhibit stunning paper couture dresses

22 paper made gowns will be on display at Vancouver’s Oakridge Centre until March 27

Most Read