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Canada: New Brunswick issues budget 2019/20

Executive summary

On 19 March 2019, New Brunswick Finance Minister Ernie Steeves tabled the province’s fiscal 2019/20 budget. The budget contains no new taxes and no tax increases.

The Minister anticipates a surplus of CA$23 million1 for 2019/20, and projects surpluses for each of the next three years.

Following is a brief summary of the key tax measures.

Detailed discussion

Business tax measures

Corporate tax rates

No changes are proposed to the corporate tax rates or the $500,000 small business limit.

New Brunswick’s 2019 and 2020 corporate tax rates are summarized in Table A.

Table A: Corporate tax rates
 
2019
NB
Federal and NB combined

Small-business tax rate*,**

2.50%

11.50%

General corporate tax rate

14.00%

29.00%

* The small business rate is based on a 31 December year end.

** The federal small business rate was reduced from 10.00% to 9.00% effective 1 January 2019.

Other business tax measures

The Minister also proposed the following business tax measures:

  • New Brunswick will not parallel the recent federal income tax measures relating to the passive investment income and reduction of the small business limit.
  • Minimum wage will increase by 25 cents to $11.50 per hour on 1 April 2019 and the Government committed to linking increases to the New Brunswick Consumer Price Index.
  • Although no details were provided, the budget announced revisions to the regulatory environment for repayable financial assistance programs in the agriculture, aquaculture and fisheries sectors.

Personal tax

Personal income tax rates

The budget does not include any changes to personal income tax rates.

The 2019 New Brunswick personal tax rates are summarized in Table B.

Table B: 2019 New Brunswick personal tax rates
First bracket rate
Second bracket rate
Third bracket rate
Fourth bracket rate
Fifth bracket rate

$0 to $42,592

$42,593 to $85,184

$85,185 to $138,491

$138,492 to $157,778

Above $157,778

9.68%

14.82%

16.52%

17.84%

20.30%

For taxable income in excess of $147,667, the 2019 combined federal-New Brunswick personal income tax rates are outlined in Table C.

Table C: Combined 2019 federal and New Brunswick personal tax rates
Bracket
Ordinary income*
Eligible dividends
Non-eligible dividends

$147,668 to $157,778

46.84%

24.59%

40.32%

$157,779 to $210,371

49.30%

27.99%

43.15%

Above $210,371

53.30%

33.51%

47.75%

* The rate on capital gains is one-half the ordinary income tax rate.

Personal tax credits

There are no proposed changes to personal credits or amounts.

Other personal tax measures include:

  • Re-introduction of the New Brunswick tuition tax credit for taxation years beginning in 2020
  • Introduction of a renewed bursary program for students attending public and private universities and colleges in New Brunswick
  • Improved subsidies for child care expenses to parents whose children attend designated New Brunswick Early Learning Centres and New Brunswick Early Learning Homes
  • Increases to per diems for memory care beds in New Brunswick from $135 to $142.50

Endnote

1. Currency references in this Alert are to CA$.

EYG no. 000810-19Gbl

Download this Tax Alert as a PDF file.

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