Saskatchewan Budget Announcement - 2019 SASKATCHEWAN BUDGET ANNOUNCEMENT - 2019 SASKATCHEWAN BUDGET HIGHLIGHTS On Wednesday, March 20, 2019, the Saskatchewan Minister of Finance Donna Harpauer presented the province’s 2019 Budget. In keeping with its theme “The Right Balance,” the government delivered a balanced budget, with a projected surplus of $34.4 million for 2019-20, $49 million for 2020-21, $72 million for 2021-22 and $84 million for 2022-23. There was very little introduced in terms of tax measures; below are highlights from Budget 2019: A. Corporate Tax Measures CORPORATE TAX RATES No new corporate income tax rate changes have been announced in this year’s Budget. The current corporate income tax rates for 2019 are outlined below: Small Business Rate General Rate Threshold Non M&P M&P Federal 9.0% $500,000 15.0% 15.0% Saskatchewan 2.0% $600,000 12.0% 10.0% POTASH PRODUCTION TAX Saskatchewan levies a Crown royalty on potash produced from Crown lands and a Potash Production Tax (PPT) on potash produced from both Crown and freehold lands in the province. The base payment component of the PPT is currently reduced by the amount of Crown and freehold royalties paid and the amount of the Saskatchewan Resource Credit (equal to 0.75 percent of the value of potash sales). As the base payment rate is set at a fixed dollar amount per tonne and the value of these deductions has continued to grow, the base payment has gradually eroded such that it currently generates very little revenue. Budget 2019 proposes that the Saskatchewan Resource Credit is eliminated for potash production, and Crown and freehold royalties will no longer be deductible in determining the base payment or the profit tax. This measure is effective April 1, 2019. SASKATCHEWAN BUDGET ANNOUNCEMENT - 2019 B. Personal Tax Measures PERSONAL TAX RATES Income Tax Brackets No new personal tax rate changes were announced in this year’s budget. The Saskatchewan personal income tax rates are as follows: 2019 Rates 2018 Rates First Bracket 10.5% 10.5% Second Bracket 12.5% 12.5% Third Bracket 14.5% 14.5% Top Combined Marginal Rates for 2019 The top marginal personal income tax rate for Saskatchewan is 14.50 percent for 2019. The current top combined federal and Saskatchewan marginal rates for 2019 are outlined below: Salary, business income, interest 47.50% Capital gains 23.75% Eligible dividends 29.64% Non-eligible dividends 40.37% NEW NON-REFUNDABLE TAX CREDITS FOR VOLUNTEER EMERGENCY RESPONDERS Budget 2019 announces the creation of new non-refundable tax credits for volunteer firefighters and for volunteer emergency medical first responders. Individuals performing at least 200 hours of eligible volunteer services in a year (as certified by the organization managing the volunteer services) will be able to claim a $3,000 tax credit amount. Eligible volunteer services consist of responding to and being on call for emergencies, attending required meetings and participating in required training. To maintain consistency with the rules related to similar federal tax credits, individuals who also provide these services as regular employees of the organization will not be eligible for the tax credit. Individuals who perform at least 200 hours of combined volunteer firefighting services and volunteer emergency medical first responder services will be able to claim one of the two tax credits. Individuals who receive honoraria for their volunteer emergency service duties may claim either the income exemption or the tax credit, but not both. This measure is effective for the 2020 and subsequent taxation years. SASKATCHEWAN BUDGET ANNOUNCEMENT - 2019 ABOUT MNP MNP is a leading national accounting, tax and business consulting firm in Canada. We proudly serve and respond to the needs of our clients in the public, private and not-for-profit sectors. Through partner-led engagements, we provide a collaborative, cost-effective approach to doing business and personalized strategies to help organizations succeed across the country and around the world. Saskatchewan Region Contacts SASKATOON Jeff Henkelman 306.664.8361 Dave Boyko 306.664.8301 Ron Friesen 306.664.8324 Jaymon Hill 306.664.8371 Rashelle Dolan 306.664.8300 REGINA Regan Exner 306.790.7907 Wayne Paproski 306.790.7941 Josh Shankowsky 306.790.7931 Jeff Harrison (Indirect Tax) 306.751.7998 SWIFT CURRENT Cindy Heinrichs 306.770.3627 Tracy O’Donnell 306.770.3645 Visit us at MNP.ca Praxity AISBL is a global alliance of independent firms. Organised as an international not-for-profit entity under Belgium law, Praxity has its executive office in Epsom. Praxity – Global Alliance Limited is a not-for-profit company registered in England and Wales, limited by guarantee, and has its registered office in England. As an Alliance, Praxity does not practice the profession of public accountancy or provide audit, tax, consulting or other professional services of any type to third parties. The Alliance does not constitute a joint venture, partnership or network between participating firms. 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