2022 Prince Edward Island budget tax highlights
On February 24, the PEI government released their 2022 budget. The following are highlights of the key tax measures.
Personal tax measures
No personal income tax rate changes were announced in this year’s budget. The current personal combined income tax rates for 2022 are outlined below:
|
Personal (combined) federal and PEI top marginal tax rates |
|
|
|
Rate |
|
Interest/regular income |
51.37% |
|
Capital gains |
25.69% |
|
Eligible dividends |
34.23% |
|
Non-eligible dividends |
47.04% |
Basic personal amount
Effective January 1, 2023 the basic personal income tax exemption will increase to $12,000 from $11,250.
Corporate tax measures
No corporate income tax rate changes were announced in this year’s budget. The current corporate income tax rates for 2022 are outlined below:
|
|
Small business corporations |
General corporations |
||
|
|
Rate |
Threshold |
Non-M&P |
M&P |
|
Prince Edward Island |
1.0% |
$500,000 |
16.0% |
16.0% |
|
Combined Federal and PEI |
10.0% |
$500,000 |
31.0% |
31.0% |
Other tax measures
Carbon levy
Effective March 31, 2022 the budget proposes an increase in the carbon levy on the carbon-based fuels that are currently taxed. No further details on this tax were provided in the budget documents.
HST rebates for charities and non-profit organizations
Starting January 1, 2023 the budget proposes to increase the HST rebate for charities and non-profit organizations to 50 per cent.
Vaping products and tobacco tax
The budget proposes to introduce a tax on vaping products and to increase the tax on tobacco. No further details on these taxes were provided in the budget documents.
Bicycle rebate
The budget announces that, starting in the summer of 2022, the province will provide a $100 rebate on the sale of any bicycle purchased in PEI.
Next steps
Contact your Baker Tilly advisor to learn more about how we can help you navigate the complexities of the Canadian tax system.
Information is current to March 4, 2022. The information contained in this release is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation.