(file photo/CKOM News Staff)

By CKOM News Staff

Legislation introduced to support $500 payments, maintain 0 per cent small business tax rate

Nov 2, 2022 | 4:08 PM

Legislation intending to make life more affordable was introduced Wednesday in Saskatchewan.

The Income Tax (Affordability) Amendment Act, 2022, incorporates the $500 Saskatchewan Affordability Tax Credit into income tax legislation, and maintains the small business tax at zero per cent, the Ministry of Finance said.

The $500 cheques, which represent a one-time payment meant to help people make ends meet amid rising inflation, will go to every resident who is at least 18 years old on Dec. 31, 2022, and who has filed a return for the 2021 tax year. The cheques – about 900,000 of them in total – will start to be mailed during the week of Nov. 14, the ministry said.

The new legislation also maintains the small business tax rate at zero per cent, retroactive to July 1. The rate will not return to two per cent until July of 2024, the Ministry of Finance said.

Donna Harpauer, Saskatchewan’s finance minister and deputy premier, said small business owners have had a difficult time recently, and are now facing new challenges.

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“Extending the small business tax rate reduction by another year provides further support to small businesses as they continue to recover from the pandemic, while facing new challenges such as inflationary pressures, interest rate hikes, supply chain issues and labour shortages,” Harpauer said in a statement.

The move is expected to save small businesses about $93 million over the next three years, the ministry said, and about 31,000 incorporated businesses are expected to benefit from the move.

“Saskatchewan is also tied for having the lowest small business tax rate in Canada and the highest income threshold of $600,000, making the province’s small business tax environment very competitive,” the ministry noted.