Budget Backgrounder: Tax Credit for New Media

The 1999-2000 budget demonstrates the government's support for the growth of multimedia opportunities in Nova Scotia. In his budget speech, Finance Minister Don Downe outlined tax incentives designed to boost the developing industry.

"We are finding that more often our film and video companies are branching out. They record their images and stories in digital form," said Mr. Downe. "The end result is often a computer screen, rather than a movie screen. The delivery system is no longer a projector, but instead a CD-ROM or a download from the Internet."

Retroactive to April 1, 1999, qualifying firms combining traditional media and digital output will receive a 15 per cent tax credit on the salaries and wages paid to employees. To be eligible, companies must be a permanent establishment in the province and develop products for commercial sale. Those products primarily used to promote the qualifying corporation are not eligible for the tax credit.

"The new-media tax credit will help foster this new industry and provide employment opportunities for hundreds of people who work in communities across Nova Scotia," said Mr. Downe.

New media combine one or more forms of traditional media in an interactive digital format. Traditional media include music, photography, video and animation. New media package these traditional media elements into a digital media product, such as a CD-ROM, DVD, broadband network service or website.

"In Halifax and Sydney, the multimedia industry is finding its wings," said the finance minister. "We already have a strong base of computer education. This tax measure will help pull all these elements together to encourage new businesses to grow here to serve the world."