December 31, 2020
Manitoba Government Announces Tax Changes Coming in 2021
– – –Benefits for Business and Ratepayers Will Protect Manitobans' Incomes: Fielding
A number of tax savings that will benefit Manitobans and help to protect their hard-earned income will come into effect Jan. 1 or early in the new year, Finance Minister Scott Fielding announced today.
“Our government is committed to reducing the tax burden on Manitobans while strengthening the services we all depend on,” said Fielding. “We are also making changes that will benefit Manitoba businesses and put them on a stronger footing as we work to overcome the financial challenges of the COVID-19 pandemic.”
Manitoba personal income tax brackets and the Basic Personal Amount will increase by 2.2 per cent for the 2021 taxation year as they are indexed to the Manitoba Consumer Price Index. As a result, an estimated 3,300 taxpayers are expected to be removed from the 2021 tax rolls, the minister noted.
Manitoba will also begin phasing out the Education Property Tax in 2021, as committed to in the most recent speech from the throne.
Other changes include:
• increasing the Health and Post-Secondary Education Tax Levy exemption threshold to $1.5 million from $1.25 million of annual remuneration. In addition, the threshold below which employers pay a reduced rate increases to $3 million from $2.5 million. The new thresholds will benefit approximately 1,000 Manitoba employers including exempting about 220 employers.
• making permanent the Manufacturing Investment Tax Credit that was to expire at the end of this year. It supports businesses that acquire qualified manufacturing and processing plant, machinery and equipment for use in Manitoba.
• extending the Mineral Exploration Tax Credit for three years to Dec. 31, 2023, supporting Manitobans who invest in flow-through shares in qualifying mineral exploration companies engaged in Manitoba with a 30 per cent income tax credit.
• extending the Cultural Industries Printing Tax Credit one year, promoting the growth of Manitoba’s print industry with a 35 per cent credit based on salaries and wages paid to Manitoba employees.
• extending the Community Enterprise Development Tax Credit one year, supporting investments in communities and community-based enterprises. Manitoba-resident investors are eligible for a 45 per cent refundable income tax credit on investments in eligible shares.
• reducing the interest rate on provincially administered tax debts, such as sales tax, health and post secondary education tax levy, fuel tax and tobacco tax, to prime plus four per cent from the current prime plus five per cent.
Eligible seniors who have not received their $200 Seniors Economic Recovery Credit in 2020 are reminded that they are able to claim it when filing their 2020 personal income tax return in 2021.
“Our government values Manitoba seniors and know that they have made extraordinary sacrifices to build our province,” said Fielding. “The Seniors Economic Recovery Credit is an important measure to protect our seniors and we encourage all those who are eligible to take advantage of this credit.”
The minister also noted that as of Nov. 6, 2020, Manitoba became the first province in Western Canada to eliminate probate fees. Applications made to the Court of Queen’s Bench for the probate of an estate of a deceased person no longer require the payment of probate fees.
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