B.C. businesses will see savings in the new year, resulting from the province’s 50 per cent cut to the provincial sales tax (PST) on non-residential electricity, Finance Minister Carole James announced yesterday.
“B.C. is the only jurisdiction in North America to charge sales tax on electricity used by businesses. We are changing that and helping businesses here in British Columbia become more competitive,” James said. “Cutting the PST on electricity is one way we are helping business owners build a sustainable economy that benefits everyone.”
Following the 50 per cent reduction that starts on Jan. 1, 2018, government will completely eliminate the PST on non-residential electricity on April 1, 2019. Residential use of electricity is already PST-exempt.
Eliminating the PST on electricity will translate into savings of more than $150 million annually for B.C. businesses. This will help them create more jobs for British Columbians, expand into new markets, and reinvest in new technologies.
Estimated annual PST paid for electricity use, by industrial sector is as follows:
- Manufacturing, including pulp and paper: $46 million
- Other services (repair and maintenance, personal care services, etc.): $27 million
- Wholesale and retail trade: $21 million
- Primary industry (forestry, mining, etc.): $21 million
- Accommodation and food services: $11 million
- Transportation and warehousing: $11 million
- Arts, entertainment and recreation: $5 million
- Construction: $2 million
- Other industry sectors: $17 million