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Manitoba Releases Budget Implementation Bill

Manitoba Releases Budget Implementation Bill

Bill includes corporate tax changes announced in 2018 provincial budget


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Manitoba's Bill 34 includes corporate tax changes that were announced in the province's 2018 budget. Although this bill received first reading on June 25, 2018, it was only recently published on August 15, 2018.

Because Manitoba did not publicly release the contents of Bill 34 until August 15, 2018 (approximately three weeks after it received first reading), it may be reasonable to consider that this bill's corporate income tax measures are substantively enacted for purposes of IFRS and Accounting Standards for Private Enterprise (ASPE) on that date. Under ordinary circumstances, the substantive enactment of these measures would have been on June 25, 2018, the date the bill received first reading (as Manitoba has a majority government).

Corporate measures
The corporate income tax measures in Bill 34 include an increase to the small business deduction limit to $500,000 (from $450,000), effective January 1, 2019. The bill also includes a number of changes specific to credit unions. Among other things, this bill:

  • Introduces a five-year phase-out of the special tax deduction for credit unions and caisses populaires, beginning on January 1, 2019
  • Eliminates the 1% profits tax on credit unions and caisses populaires in Manitoba with taxable income over $400,000, effective January 1, 2019
  • Makes certain retroactive amendments to the small business deduction for credit union provisions.

The bill also includes a number of changes affecting corporate income tax credits, such as:

  • Updates to the Research and Development Tax Credit provisions to ensure they appropriately reflect earlier federal changes
  • The introduction of a new refundable income tax credit available for corporations that create new child care centres
  • The elimination of the Rental Housing Construction Tax Credit, effective for January 1, 2019, while also extending the deadline for making a rental housing project available for use to qualify for credit by one year (until the end of 2020), under certain conditions
  • The extension of the Manitoba Book Publishing Tax Credit and the Cultural Industries Printing Tax Credit to December 31, 2019 (from December 31, 2018).

For more information, contact your KPMG adviser.

Information is current to August 21, 2018. The information contained in this publication 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. For more information, contact KPMG's National Tax Centre at 416.777.8500

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