New Brunswick Budget Bill #1 Receives Royal Assent | KPMG | CA

New Brunswick Budget Bill #1 Receives Royal Assent

New Brunswick Budget Bill #1 Receives Royal Assent

New Brunswick Bill 18 implements some of the measures that were announced in New Brunswick's 2016 budget; it received Royal Assent on June 28, 2016.

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New Brunswick Budget Bill #1 Receives Royal Assent

The provisions in Bill 18 are considered substantively enacted for purposes of IFRS and Accounting Standards for Private Enterprise (ASPE) as of February 3, 2016, which was when the bill received its first reading in the New Brunswick legislature (New Brunswick has a majority government). Bill 18 is enacted for U.S. GAAP purposes on June 28, 2016, the date the bill received Royal Assent.

Bill 18 enacts the following corporate tax measures:

  • An increase to the corporate tax rate to 14% (from 12%), effective April 1, 2016
  • An increase to the financial corporation capital tax rate for banks to 5% (from 4%), effective April 1, 2016
  • A new employment tax credit for purposes of computing the financial corporation capital tax for banks operating a business services centre in New Brunswick, effective April 1, 2016.

The new employment tax credit (for financial corporation capital tax purposes) was not included in New Brunswick's budget. The previously announced measure to reduce the small business tax rate to 3.5% (from 4%) is included in New Brunswick Bill 32 which has received first reading but has not yet received Royal Assent.

For more information, contact your KPMG adviser.

Information is current to July 12, 2016.

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