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February 21, 2019
Canada: Nunavut issues budget 2019/20
On 20 February 2019, Nunavut Finance Minister George Hickes tabled the territory’s fiscal 2019/20 budget. The budget contains no new taxes and no tax increases.
The Minister anticipates a deficit of CA$35 million1 for 2018/19 and projects a deficit of $12 million for 2019/20.
Following is a brief summary of the key tax measures.
Business tax measures
Corporate tax rates
No changes are proposed to the corporate tax rates or the $500,000 small-business limit.
Nunavut’s 2019 corporate tax rates are summarized in Table A.
Table A: Nunavut corporate tax rates
* The small-business rate is based on a 31 December year-end.
** The federal small-business rate was reduced from 10.0% to 9.0% effective 1 January 2019.
Personal income tax rates
The budget does not include any changes to personal income tax rates.
The 2019 Nunavut personal tax rates are summarized in Table B.
Table B: 2019 Nunavut personal tax rates
For taxable income in excess of $95,259, the 2019 combined federal-Nunavut personal income tax rates are outlined in Table C.
Table C: Combined 2019 federal and Nunavut personal tax rates
* The rate on capital gains is one-half the ordinary income tax rate.
Other tax measures
The Minister indicated that the Government is currently developing options on how best to return to taxpayers the revenue that will be generated by the federal backstop carbon pollution pricing system, which Nunavut chose to voluntarily adopt.
The details on this revenue return will be made public before the carbon pricing system takes effect in the territory on 1 July 2019.
1. Currency references in this Alert are to CA$.
For additional information with respect to this Alert, please contact the following:
Ernst & Young LLP (Canada), Toronto
Ernst & Young LLP (Canada), Montréal
Ernst & Young LLP (Canada), Calgary
Ernst & Young LLP (Canada), Vancouver
Ernst & Young LLP, Canadian Tax Desk, New York