Last updated: Mar. 31, 2022
Last week Saskatchewan Finance Minister Donna Harpauer tabled the province’s fiscal 2022-23 budget.
Budget 2022 focuses on supporting the people of Saskatchewan by investing in healthcare, education, and childcare; building a strong Saskatchewan through investments in capital projects; and growing a strong economy.
The government is forecasting the following deficits:
- $2.18 billion in 2021-22
- $463 million in 2022-23
- $384 million in 2023-24
- $321 million in 2024-25
- $165 million in 2025-26
Budget 2022 did not announce any new changes to corporate or personal tax rates.
Saskatchewan Increases Agricultural spending in 2022/23
The agriculture portion of the Provincial Budget saw an increase in agriculture spending from $386.9 million to $462.4 million.
The increase in spending covers several key areas, with approximately $70 million dollars designated for crop insurance premium costs.
The budget estimates AgriStability costs to drop slightly from $25.3 million last year to roughly $24.6 million. An increase in AgriInvest costs from $35.7 million to $39.8 million is expected.
Other key changes that will benefit agriculture include:
- exempting the digging of dugouts from PST
- adding $2.5 million of support for irrigation development
- doubling the funding for the Animal Protection Services of Saskatchewan to $1.6 million
- earmarking just under $34 million for research, including $2 million dollars of funding for the Global Institute for Food Security
- investing $3.1 million to fully fund Saskatchewan’s International Trade and Investment Strategy, which includes the new trade offices in the United Kingdom, United Arab Emirates, Mexico, and Vietnam
- enhancing Saskatchewan’s Value-Added Agriculture incentive
Saskatchewan Value-added Agriculture Incentive
The budget enhances the tax credit rate for the Saskatchewan Value-added Agriculture Incentive up to 40% (from 15%), dependent on the level of investment. This credit applies to capital expenditures valued at $10 million or more for newly constructed or expanded value-added agriculture facilities in Saskatchewan.
Specifically, the budget enhances the tax credit rate for the incentive at the following rates:
- 15% on the portion of a project up to $400 million
- 30% on the portion of a project between $400 million to $600 million
- 40% on the portion of a project over $600 million
Qualifying projects may include canola crush facilities, pea protein processors, oat milling operations, malt producing operations, and cannabis oil facilities.
The enhanced tax credit rate is retroactive to the origin of the program in 2018. The maximum credit available for a single qualifying project is $250 million.
Personal Tax Measures
Personal income tax rates – No change
No new personal income tax rate changes have been announced in this year’s budget. As a result, Saskatchewan’s personal income tax rates are as follows:
Personal tax credits for 2021 will be indexed by 1.024%. The maximum tax credit amounts and actual Saskatchewan tax credits for 2021 and 2022 are set out below.
Personal Tax Credits
Saskatchewan Home Renovation Tax Credit
The Home Renovation Tax Credit (HRTC) is a 10.5 per cent non-refundable tax credit on up to $20,000 of eligible renovation expenses incurred between October 1, 2020 to December 31, 2022. A maximum tax credit of $1,155 can be claimed on the 2021 tax return. A further maximum tax credit of $945 can be claimed in 2022 for eligible expenses incurred between January 1, 2022 and December 31, 2022.
Corporate Tax Measures
Corporate Tax Rates
The budget confirms the temporary reduction of the small-business rate from 2.00% to nil,
which commenced on October 1, 2020 and ends on June 30, 2022. No changes are proposed to the $600,000 small-business limit.
As a result, Saskatchewan’s corporate tax rates is as follows:
Provincial Sales Tax (Pst)
The budget proposes the following changes to Provincial Sales Tax (PST):
- The PST base will be expanded to include admission and entertainment charges, following the federal Goods and Services Tax treatment, effective 1 October 2022. The province expects to collect $10.5 million in revenue in 2022-23 and an additional $21.0 million annually.
- The sale of audiobooks will be exempt from PST, effective 1 April 2022.
Examples of the types of charges that are currently exempt but will become taxable:
- admissions to sporting events, concerts and shows, movie theatres, museums, zoos and historical sites
- admissions to fairs, rodeos, trade shows, arts and crafts shows
- admissions to conferences and seminars
- professional theatre tickets and subscriptions
- gym, golf and curling fees and memberships
- hunting and fishing guide fees and outfitter services
Examples of certain situations that remain exempt from PST:
- admissions to certain school, university or minor league sports and amateur theatre productions
- fees for qualified recreational programs where the activities are provided by school or non-profit organizations for those 14 years of age and under
- fundraising events where part of the cost of admission can reasonably be considered a donation to a charity
Other Tax Changes
The budget introduces a slight increase to the current Education Property Tax mill rates.
The budget announces that the Government of Saskatchewan will begin the process of developing a proposal to take over administration of, and all revenues from, the federal carbon tax backstop fuel charge.
Other Noteworthy Items
The budget delivers a record $6.8 billion invested in health care funding. An increase of $21.6 million in Budget 2022 is allocated to address the surgical waitlist caused by the COVID-19 pandemic with the goal of returning to pre-pandemic wait times by the end of March 2025.
Education & Training
The 2022-23 Budget includes $3.8 billion for education, up $47.2 million from 2021-22. In total $2.88 billion is going towards pre-kindergarten to grade 12 students and early learners.
$114 million is being invested into training programs including $2.5 million for the new Re-Skill Saskatchewan Training Subsidy (RSTS). This is a temporary program that reimburses employers for approved training programs for their employees up to a maximum of $5,000 per business.
A $20 million investment will launch a new Education and Training Incentive program, providing up to $200 per month for individuals to complete education and training programs.
$309.6 million has been allocated to fund early learning and childcare, including funding in support of the federal government’s $10/day childcare plan.
The budget includes $475,000 in funding to create the Saskatchewan Indigenous Investment Finance Corporation (SIIFC). This provides up to $75 million in loan guarantees for private sector lending to Indigenous communities and organizations for investments into natural resources and value-added agricultural projects.
Saskatchewan Technology Start-up Incentive
The budget increases the annual cap of the maximum value of the Saskatchewan Technology Start-up Incentive (STSI) tax credit to $3.5 million per year (from $2.5 million), effective April 1, 2022.
This program offers a non-refundable 45% tax credit to individual, corporate, or venture capital corporation investments in Eligible Start-up Businesses that are developing new technologies, or applying existing technologies in a new way, to create proprietary new products, services or processes that are repeatable and scalable.
In the 2021 budget, the province extended the Saskatchewan Technology Start-up Incentive through to 2025-26.
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