Wednesday September 2, 2020 | VICTORIA, BC [Some links updated August 2022]
by Mary P Brooke, Editor | Island Social Trends
The Province is delaying implementation dates to April 2021 for changes to provincial sales tax (PST) deadlines and B.C.’s carbon tax, to help businesses and families through the COVID-19 pandemic and recovery.
A scheduled increase in April 2020 from $40 to $45 per tonne of carbon dioxide equivalent (tCO2e) had been paused until at least October as part of the COVID-19 Action Plan. Upon review, the B.C. government has decided the carbon tax rate will remain at its current level of $40 per tCO2e until April 2021, when it will increase from $40 to $45 per tCO2e. The carbon tax will increase to $50 per tCO2e in April 2022.
This change will give businesses and families more time to recover from the COVID-19 pandemic, while still meeting the required federal carbon-pricing backstop rate of $50 per tCO2e by 2022.
PST continues on sweetened carbonated beverages:
The implementation a planned tax changes that will eliminate the PST exemption for carbonated beverages that contain sugar, natural sweeteners or artificial sweeteners, is being delayed until April 2021.
That is the government’s way of trying to curtail the consumption of soda pops that are considered to have no nutritional value. As soda beverage sales are up during the pandemic, this provides a reliable source of taxation revenue to help offset other areas of taxation adjustment.
Ecommerce outside BC gets a further break:
The addition of new PST registration and collection requirements for e-commerce businesses located outside B.C has been delayed to April 2021.
This is a curious decision, as competition from outside BC is probably not helpful to companies within BC that rely on e-commerce for their sales (especially during the pandemic). However, it’s probably one way for BC Finance to reduce its administration load over the COVID fall/winter of 2020-21.
EHT quarterly installment dates extended:
To further support businesses, the employer health tax (EHT) 2020 quarterly installment dates are being extended as follows:
- Dec 31, 2020 (original installment date was June 15, 2020)
- Jan 31, 2021 (original installment date was Sept 15, 2020)
- Feb 28, 2021 (original installment date was Dec 15, 2020)
The government says these extensions will give businesses more access to cash flow during recovery and more time to determine their annual payroll and estimate the amount of EHT they will owe. The 2020 EHT filing and balance due date will remain March 31, 2021.
No further extension for PST filing:
As a reminder for businesses, effective March 23, 2020, as part of B.C.’s COVID-19 Action Plan, the filing and payment due dates for the following sales taxes were extended to Sept. 30, 2020, along with the 2019 EHT filing and balance due date:
- Provincial Sales Tax (PST) (7%)
- hotel tax, also known as municipal and regional district tax (8%)
- tobacco tax
- motor fuel tax
- carbon tax [link updated in 2022]
These administrative deferrals are not being extended further. Businesses were never able to spend taxes collected from customers such as PST, but delaying tax remittances removed an administrative burden from potentially short-staffed businesses during the beginning of the pandemic.
Budget 2021 in the works:
Earlier this week, Finance Minister Carole James said that work to develop BC’s Budget 2021 is underway.
There is an unexpected deficit carrying over from 2019-2020 due to the pandemic hitting in March 2020 (fiscal year end is March 31). In that one month alone, there were additional and unexpected expenditures of $11 million for core government services and $35 million more spent for additional health care requirements due to the management of COVID-19.
===== Learn More:
Tax information for businesses: https://www2.gov.bc.ca/gov/content/taxes/tax-changes/budget-changes
Information about supports for business:
www2.gov.bc.ca/gov/content/employment-business/business/small-business/resources/covid-19-supports (https://www2.gov.bc.ca/gov/content/employment-business/business/small-business/resources/covid-19-supports)
Learn about economic recovery planning: www.gov.bc.ca/recoveryideas
More about BC’s Carbon Tax Regulations: https://ca.edubirdie.com/blog/bc-carbon-tax-regulations [external link]
