Key updates from Québec’s 2026 budget

Québec’s 2026–27 budget, tabled March 18, 2026, introduces targeted tax system and property tax measures focused on administration and service delivery, supporting retirement savings, and extending or expanding select refundable credits. No broad-based personal or corporate income tax rate changes were announced. The budget instead focuses on program delivery changes and sector specific tax incentives. 

Below, we highlight the measures most relevant to individuals and businesses. 

Personal income tax measures 

No personal income tax rate changes were announced as part of the budget. The current personal combined top income tax rates for 2026 are outlined below: 

• Automating Québec income tax return filing (Revenu Québec): Revenu Québec will automatically file tax returns for at least 10,000 individuals starting with the 2026 taxation year. The initiative is aimed at assisting vulnerable individuals. Legislative amendments are expected by spring 2027. 

• Voluntary Retirement Savings Plan (VRSP) changes: Budget 2026–2027 announces changes intended to make the VRSP more attractive, including: a minimum contribution rate of 2% of salary, an increase to the management fee cap (to 1.50% before QST for existing options), and new investment options requiring an employer contribution of at least 2% of salary. Additional guidance is expected from Retraite Québec.

Business and industry income tax measures 

No corporate income tax rate changes were announced as part of the budget. The current corporate income tax rates for 2026 are outlined below: 

• Refundable tax credit for Québec news media: This credit has been expanded to make additional news media eligible (including certain TV/radio news bulletin or information segment activities) and the annual salary cap per eligible job is increased from $75,000 to $85,000 (assistance remains 35% of eligible wages, subject to the cap). The measure also refocuses eligibility, including removing certain information technology activities from eligibility. 

• Tax credit to support the digital transformation of print media businesses: This credit has been extended to December 31, 2028, with a phased-down rate (currently 35%; reduced to 20% in 2027 and 10% in 2028). 

• Tax credit for Québec film and television production: This credit has been adjusted to reflect new viewing habits (e.g., audiovisual productions will no longer need to meet a minimum number of minutes/episodes to qualify). In addition, financial assistance from the Indigenous Screen Office will no longer reduce expenses eligible for the credit. 

• Tax credit for the development of e-business integrating artificial intelligence (TCEB AI): Adjustments were announced to provide greater predictability by clarifying the eligibility of certain preparatory work needed to integrate AI into IT solutions. The credit offers a 30% rate on qualified wages (for eligible IT businesses). This measure is part of Québec’s e-business tax credit regime, which is often referred to as the CDAE. 

• Tax credit for Gaspésie and certain maritime regions of Québec: This refundable tax credit supports businesses in Gaspésie–Îles-de-la-Madeleine, Côte-Nord and Bas-Saint-Laurent (particularly in the seafood processing sector) by helping offset eligible wage expenditures. The credit has been extended for five years, until December 31, 2030, and the eligible territories for the seafood processing sector have been expanded to include the La Matapédia, La Mitis and RimouskiNeigette RCMs. 

• Immediate expensing for greenhouses: To support investment in the bio-food sector, Budget 2026–2027 introduces immediate expensing for greenhouses. This measure applies to greenhouses acquired since November 4, 2025 that become available for use before 2030, allowing eligible businesses to deduct the full cost of the investment in the first year. 

Other tax measures 

• Tax rate on insurance premiums harmonized with the QST rate (effective January 1, 2027): The Budget Plan reflects the previously announced harmonization of the tax rate on insurance premiums with the QST rate, effective January 1, 2027. As a result, the tax rate on insurance premiums will increase from 9% to 9.975% for taxable insurance premiums paid after December 31, 2026. 

• Temporary holiday from contributions to the Health Services Fund (HSF) for certain employers (2026–2027): Effective January 1, 2026, the government introduced a two-year temporary holiday from HSF contributions to provide support to eligible employers in the agriculture, forestry and fishing sectors. Businesses may qualify for a partial or total holiday depending on the proportion of operations related to specified activities (including crop and animal production, aquaculture and fishing, and certain forestry activities). 

• School property tax- government contribution to limit increases to 3% on average: The budget reflects the impact of an additional Québec government contribution to limit the average increase in school taxes to 3% for 2025–2026 and 2026–2027. 

What this means for you 

Québec’s 2026–27 budget focuses on targeted administrative changes, retirement savings updates, and select sector-specific credits rather than broad-based rate changes. These measures may create planning and reporting considerations for individuals and businesses, depending on eligibility and timing. Your Baker Tilly advisor can help you assess how the measures apply to your situation and identify any opportunities or next steps.