New Brunswick Finance Minister Cathy Rogers tabled the government’s pre-election budget today. The budget featured a decrease in the small business tax, increased spending on youth employment, seniors and trade; while putting off previous balanced budget promises until 2022.
Retail Council of Canada (RCC) is pleased that the budget does not contain any tax increases. The Small Business Tax Rate will decrease by 0.5% to 2.5% on April 1, 2018. The threshold for the small business tax rate will be $500,000.
Further details on the budget can be found at: http://www2.gnb.ca/content/gnb/en/departments/finance/budget/2018-2019/budget.html
The New Brunswick provincial election is scheduled for September 24, 2018 although the government can call the election for an earlier date.
- The 2018-19 budget will see an increase of almost $237 million in spending. The budget will increase the previously projected deficit of $117 million to a $189 million shortfall.
- The government had been promising a small surplus for 2020-21 however, the increased spending has moved the projected balanced budget to 2021-22. This comes after three straight years where the government beat its deficit reduction targets.
- The increased spending focused on summer job programs for youth (+$28 million), wage increases for those who care for seniors / daycare workers (+$20 million), and more business subsidies in areas such as fisheries and forestry (+$25 million).
- The government anticipates $7.2 million in revenue from retail cannabis sales, through taxes and the profits from Cannabis NB (retail stores run by NB Liquor), and from producer fees for education and awareness. This projection only covers the final nine months of the fiscal year as cannabis sales will not begin until July 2018.
- The carbon tax will not add new taxes to New Brunswick businesses as the government has re-assigned part of the existing provincial gas tax as the carbon tax. This will add $37.4 million to the climate change fund to pay for climate initiatives and staff salaries.
What RCC Did/Next Steps:
RCC attended the budget lock up and used the opportunity to speak with the various government officials in attendance about issues of importance to the retail sector.
In previous years, RCC has presented retailers with information regarding the Youth Employment Fund. Compared to similar programs across Canada, this program is generally user friendly for businesses. Today’s budget has just increased the funding for this program, which subsidizes the wages for unemployed or underemployed youth between the ages of 18-29 years old. The subsidy lasts for up to six months. Interested retailers are encouraged to access the program information at the following link:
If you have any questions or concerns, please don’t hesitate to contact: Jim Cormier, Director, (Atlantic) at: or 902-422-4144