Taxes rise for some, lower for others
James announced a mix of tax increases and cuts that initially brings in little net new revenue this year ($50 million). The net increase grows materially over time, however, to $480 million by 2019-20. The new government is reinstating a higher personal income tax rate (16.8 per cent) for those with taxable income exceeding $150,000 and raising the general corporate income tax rate from 11 per cent to 12 per cent. On the other hand, the government is lowering the small business tax rate from 2.5 per cent to two per cent and upholding the previous government’s pledge to cut Medical Services Plan premiums by 50 per cent.
James indicated that her government is still committed to eliminate these premiums completely, although a decision in this respect has been delayed to a future budget.