On February 22, 2022, the Honourable Caroline Wawzonek, Minister of Finance, presented the fiscal 2022–23 Northwest Territories budget. The aim of this budget is directed at the five priorities of climate change, health and well-being of the population, safety of residents and communities, supporting vulnerable populations, and improving education.
This year’s budget did not contain any announcements related to new taxes. However, the minister announced a couple of tax increases, as noted below.
The budget address reaffirmed a commitment under the Pan-Canadian Framework on Clean Growth and Climate Change to increase the carbon tax rates to $50 per tonne of greenhouse gas emissions, effective July 1, 2022. This rate increase is a federally mandated adjustment as part of the territories’ commitment to carbon pricing under the federal plan.
The carbon pricing system was created to encourage the reduction of fossil fuel use with an additional goal of not increasing the cost of living or inhibiting economic development. To help achieve this goal and offset the impact of the higher carbon tax rate, increases to the Cost of Living Benefit equal to $260 per adult and $300 per dependent under the age of 18 years will be implemented on July 1, 2022. In addition, further spending has been allocated for rebates related to tax paid on heating fuel, diesel used to generate electricity for distribution, and the large emitter program.
Consistent with prior years, property tax rates will be increased based on inflation rates. In addition, a planned five-year fee review will be carried out, which could yield changes in fee amounts in 2022–23.
Further information on the 2022–23 Northwest Territories budget is available on the Department of Finance website at Northwest Territories Budget 2022
If you have any questions about how these proposed changes might impact your organization, please do not hesitate to call the Ryan TaxDirect® line at 1.800.667.1600.