(April 15/18): On April 6, The P.E.I. government tabled a balanced budget with a slim $1.5 million surplus. The budget delivered a small measure of tax relief to Island restaurateurs, including a reduction in the small business corporate income tax rate and an increase in the basic personal exemption.
For 2018, the small business tax rate will be reduced by 0.5 per cent to 4 per cent and the government also committed to further reduce the rate over the coming years.
Unfortunately, the budget did not contain measures to end bracket creep. P.E.I. remains one of only two provinces not to index its tax brackets – leading to a hidden inflationary tax grab each year.
However, the government announced two $500 increases to the basic personal exemption in 2018 and 2019. This means Islanders will keep more of their hard earned money leading to an increase in disposable income.
The budget also includes a new Small Business Investment Grant. Businesses will be eligible for a 15 per cent rebate on the purchase of new equipment or technology up to $25,000.