On April 11, 2019, the Ontario government released its 2019 Budget. The budget contained little in the area of tax measures so a quick glance is all you will likely need. The budget includes the following proposed tax measures:
- There were no proposed changes to corporate or personal income tax rates.
- Introduction of a new refundable Childcare Access and Relief from Expenses (CARE) personal tax credit in respect of child care costs. The CARE tax credit would be based on eligible child care expenses and family income. The tax credit calculation would be based on a sliding scale for households earning up to $150,000 per year, with low-income households benefitting the most. The CARE tax credit would be effective for the 2019 tax year.
- Elimination of the Estate Administration Tax on the first $50,000 of the value of the estate. The Estate Administration Tax would continue to apply to the value of the estate exceeding $50,000 at the current rate. The proposed calculation of Estate Administration Tax would apply if an estate certificate is requested on January 1, 2020, or later.
- Reduction of the qualifying minimum Ontario labour expenditure for eligible digital games from $1,000,000 to $500,000 for specialized digital game corporations applying for the Ontario Interactive Digital Media Tax Credit. This proposal would be effective for taxation years commencing after April 11, 2019.
- Introduction of the Ontario Job Creation Investment Incentive, which parallels the immediate write-off measures and the Accelerated Investment Incentive announced in the federal government’s Fall Economic Statement 2018. These measures are in place for assets acquired after November 20, 2018, and will be phased out from 2024 to 2027. Under these measures:
- Manufacturing and processing machinery and equipment and specified clean energy equipment can be immediately written off; and
- Most other capital investments are eligible for an Accelerated Investment Incentive that provides a depreciation rate of up to three times the normal rate in the first year the asset is put into use.
- A promise to review the cultural media tax credit certification process to streamline administration, reduce the tax credit application backlog and help companies receive their tax credits faster.
That’s it, that’s all, folks. Until next year!
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