Pulp mills like Harmac near Nanaimo would benefit from a break on their substantial power bills. (Black Press files)

PST relief proposed for business electricity bills

Hospitals, schools and municipalities also pay

  • Feb. 21, 2017 3:30 p.m.

Finance Minister Mike de Jong has accepted the advice of a business advisory group, proposing to take the provincial sales tax off business electricity bills over the next two years.

In his pre-election budget Tuesday, de Jong announced a plan to cut the PST on electricity in half effective Oct. 1, from seven per cent to 3.5. The rest would be removed in April 1, 2019.

Residential and farm power bills are already exempt from PST. Municipalities, hospitals and schools pay PST on their electricity purchases and would benefit from the change.

De Jong set up a Commission on Tax Competitiveness last year, and it identified B.C. as the only jurisdiction in North America that applies sales tax to electricity bills.

In January, mayors of North Cowichan, Quesnel, Vernon, Port Alberni, Mackenzie, Powell River, Taylor and Port Alice wrote to de Jong asking for the measure to assist struggling sawmills and pulp mills.

“It’s good news for the pulp and paper industry, good news for our workers and communities,” said Len Posyniak, senior vice president of Catalyst Paper. “We’re BC Hydro’s largest industrial user, and we make up about five per cent of the load.”

The province currently takes in about $164 million a year from the tax. The finance ministry estimates that the elimination would save small and medium-sized businesses about $50 million a year.

The budget also proposes to reduce the small business income tax rate by half a point to two per cent. De Jong said that puts B.C’s small business tax at the second lowest rate in Canada, behind Manitoba which has no income tax on small business.

Just Posted

Reel Reviews: A shallower Deadpool

We say, “It is more of the same for Deadpool 2.”

Kelowna Vegan Festival takes over the Rotary Centre

The plant based creations stem from wanting to create a product that brings people together

UPDATE: West Kelowna fire deemed suspicious, crews dousing hot spots

Boucherie fire quiet overnight, mop-up continues, while evacuees have returned home.

Where to find the best ingredients for a vegan charcuterie board in the Okanagan

It’s warming up, pair your summer whites with a vegan charcuterie creation

Airbnb hosts earning millions in the Okanagan

The Okanagan was among the list of three Canadian wine markets.

Trans Mountain pipeline: Is it worth the risk?

Concerns range from the threat of an oil spill to the impact of tanker traffic on wildlife

Wildfire sparked north of Merritt, estimated 8 hectares

BC Wildfire Service is responding to the fire near Chattaway Lake FSR 27 kilometres north of Merritt

Call for artists for upcoming South Okanagan exhibition

The Penticton Art Gallery is inviting artists from across the globe to submit artworks

B.C. to spend $181M to create 200 general practitioner jobs

Jobs will go to new medical school graduates

Vernon company wins Ozone best production

Powerhouse Theatre’s Calendar Girls will move on to the Theatre BC Mainstage Festival

Host AquaJets fly at long course invitational

Kelowna swim club wins team title at annual spring meet at H2O

Federal leaders trade barbs about India trip at press gallery dinner

Justin Trudeau’s infamous trip to India earlier this year was the focus of many of the jabs

Most Read