On March 28, 2012, Finance Minister Blaine Higgs presented New Brunswick’s 2012-13 budget, with the focus being on reducing the province’s deficit by half. The deficit for 2012-13 will be reduced to an estimated $183 million, in comparison to an estimated $448 million deficit for 2011-12. This will be done without raising the HST, income or gasoline taxes, and without introducing any highway tolls.
The most significant tax changes announced in the budget are summarized below.
Commodity Tax Measures
Although no new commodity taxes or increases to existing sales taxes were announced, the government plans to increase and protect its revenues in a number of ways, and these measures may have an impact on the collection of commodity taxes in the province.
First, the province intends to intensify its efforts regarding the collection of unpaid accounts receivable balances in order to reduce revenue losses. Protecting this revenue is intended to prevent future tax and fee increases for the residents of New Brunswick.
In addition, the government is working on developing a royalty system that aims to generate revenue from the development of its natural resources. The goal of the new system will be to ensure that the province receives its fair share of profits from those resources.
Corporate Income Tax Measures
The budget announced that, effective April 1, 2012, the Financial Corporation Capital Tax will increase from 3% to 4%.
The province also announced that the Dividend Tax Credit for dividends from corporations subject to the general corporate income tax rate will be reviewed.
Additional information on the 2012-13 New Brunswick budget is available on the province’s web site at:
2012-13 New Brunswick Budget.