Planned reductions in corporate tax rates for the years 2017 to 2019 have been cancelled by the federal government.
A measure had been introduced in 2014 to gradually reduce federal income tax rates for small business corporations from 11% to 9%. When combined with provincial income taxes for small business corporations , the total tax rate in BC for these companies would have been reduced from 13.5% to 11.5%.
The first of these planned tax cuts was implemented by the previous federal government for 2016, bringing the small business corporate tax rate down to 13%.
Corporate tax rates on other forms of income will remain the same in BC as they have in the past. The general corporate tax rate on income that does not qualify for the small business corporate tax rate is 26%. Investment income earned within a company is taxed at 49.5%. These rates are lower in BC than in any other province in Canada.