Tax Measures Under Canada’s COVID-19 Economic Response Plan

The government stated that both of these measures provided the equivalent of up to $30 billion in interest-free loans to Canadian businesses and they will help businesses continue paying their employees and their bills, and help ease cash-flow challenges across the country.

Electronic signatures on GST/HST documents

The CRA has indicated[80] it will accept, as a temporary measure, electronic signatures for GST/HST documents submitted online. Effective July 6, 2020, businesses will be able to use a new electronic service to submit a GST/HST document with an electronic signature. The link to this new service will be found on the My Business Account main web page of the GST/HST program account menu. This temporary measure does not apply to GST/HST returns and forms that are paper filed.

Alberta Tax Measures

On March 18, 2020, the Government of Alberta released the following tax measures, which were supplemented on May 28, 2020, and June 30, 2020.

Measures for businesses

  • Effective July 1, 2020 the general income tax rate on businesses decrease[81]d from 10% to 8%.
  • Businesses with corporate income tax balances owing or installment payments coming due between March 18, 2020, and August 31, 2020 will be able to defer[82] these payments until September 30, 2020. Penalties and interest that would otherwise be payable in respect of these payments will be waived[83]. The deferral does not apply in respect of tax balances or installment payments made prior to March 18, 2020. The filing deadline[84] for an Alberta Corporate Income Tax Return (AT1) has been extended to June 1 for an AT1 that would otherwise have a filing deadline between March 18 and June 1, 2020, and September 1 for an AT1 that would otherwise have a filing deadline in June, July or August, 2020. A late-filing penalty will not be assessed as long as the AT1 is filed on or before the respective extended deadline. The filing deadline for a Notice of Objection (Form AT97) that would otherwise have a filing deadline between March 18 and June 30 is extended to June 30, 2020.
  • Education property tax rates will be frozen at 2019 levels, reversing the planned 3.4% increase added in 2020 Alberta Budget. Moreover, collection of non-residential education property tax for businesses will be deferred for six months. Municipalities are expected to set the education property tax rates as they normally would, but to defer collection. Any deferred amounts will be repaid in future tax years.
  • The Government of Alberta will modify its corporate income tax audit and collection practices during the COVID-19 pandemic, but did not provide specific details on the proposed modifications.
  • Hotels and other lodging providers will be able to keep the amounts of tourism levy[85] collected between March 1, 2020, and December 31, 2020. For amounts that became due to the government on or after March 27, 2020, but are not eligible for this additional assistance, hotels and other lodging providers may defer payment of the tourism levy until August 31, 2020. However, the government still expects returns to be filed as required by legislation. Late-filing penalties will not be applied between March 27, 2020, and August 31, 2020, if returns and payments are made on or before August 31, 2020. Hotels and other lodging providers must continue to collect the tourism levy from guests staying at their properties during this period.
  • Employers can defer their payment to the Workers’ Compensation Board (“WCB”) premium payment until 2021. For small and medium-sized enterprises, the Government of Alberta will cover 50% of the 2020 premium when it is due in 2021. Large companies can defer payment until 2021, at which time they will have to pay in full. Employers who have already paid their dues are eligible for a credit or rebate.

Measures for individuals

  • Education property tax rates will be frozen at 2019 levels, reversing the planned 3.4% increase added in 2020 Alberta Budget.

British Columbia Tax Measures

On March 23, 2020, the Government of British Columbia announced the following tax measures as part of its “BC COVID-19 Action Plan[86]”, which commits $5 billion in income supports, tax relief and direct funding for people, businesses and services.

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