The Québec Government tabled its last budget before the fixed date election scheduled for October 1st. Most personal income tax measures having already been announced in a mini-budget last Fall, the 2018-2019 budget spreads the money to the point where there is something for all economic sectors.
- Balanced budget with planned expenditures of $76.9 billion (increase of 5.2% compared to last year).
- 5% increase in program expenditures for education.
- 5.3% increase in funding for healthcare institutions.
- A $2.3 billion additional investment in infrastructures to facilitate the mobility of people, $2.2 billion for education and $1.2 billion to develop Quebec’s digital strategy.
- Measures that specifically affect families: increase of the tax credit for childcare expenses, introduction of a first-time home buyers’ tax credit, extension of the eligibility period for the RénoVert tax credit.
Elements of Interest for Retailers:
- $349 million over 5 years for the bio-food industry, including $10.8 million over five years for Aliments du Québec.
- Increase to the income threshold eligible for a reduced contribution rate to the Health Services Fund (payroll tax).
- Gradual reduction of the contribution rate for SMEs for the services sector (from 8% to 4% by 2021 on the first $500,000 of taxable income).
- Collection of the QST in e-commerce:
– Obligation for suppliers without a physical presence in Québec and located in Canada to register with Revenu Québec and collect and remit the QST;
– Québec Government will discuss with other provinces to put in place for information sharing agreements and provide mutual assistance in fiscal matters;
– Introduction of a pilot project at the Canada Post sorting centre in Montréal to improve parcel processing by the Canada Border Services Agency.
- RCC will continue pushing for the implementation of measures, for all retailers, to mitigate the impact of minimum wage increase as well as the upcoming changes to labour standards.
- RCC will continue working on De Minimis as part of the NAFTA negotiations and will work closely with the Québec Government to identify measures needed to ensure the collection of the QST and environmental fees (ecofees) in e-commerce.
- As the election approaches, RCC will engage all political parties to raise awareness of key issues affecting retailers in Québec and generate commitments on their part.