Budget Bulletin: Tax Relief for Nova Scotians

LOWER PERSONAL INCOME TAXES FOR A STRONGER ECONOMY

Nova Scotian taxpayers will save an estimated $147 million in 2004 because of lower personal tax rates announced in the 2003-04 budget and will save an estimated $68 million from a one-time tax rebate of $155 in 2003 that will be mailed out beginning this June. The refund will ensure that tax reductions make it to the hands of individual Nova Scotians as soon as possible. The lower tax rates also mean more than 3,500 Nova Scotians will no longer pay provincial income taxes.

Tax relief is an important part of the government's plan to make Nova Scotia a more attractive place to live and work.

Effective January 1, the tax rates for all three brackets will be reduced, with the largest percentage rate reduction coming in the lowest bracket. That rate will be reduced from its current 9.77 per cent of taxable income to 8.79 per cent. The middle bracket will be lowered from 14.95 per cent to 13.58 per cent and the highest bracket will be reduced from 16.67 per cent to 15.17 per cent. Collectively, these tax reductions amount to a 10 per cent reduction in total provincial personal income tax revenues.

The reductions* mean that a family of four with a single wage earner making $40,000 will save an estimated $276 over what they will pay in 2003. A single individual making $20,000 will save about $113 over 2003 while a family of four earning $60,000 will save about $551 over 2003.

These new rates will once again give Nova Scotia the lowest statutory rates in Atlantic Canada and improve our competitive position within the rest of the country.

The one-time rebate of $155 per taxpayer will be delivered to residents of Nova Scotia who paid Nova Scotia tax in 2001, 2002 or will pay income tax in 2003. Payments will be administered by the Canada Customs and Revenue Agency with the first payments expected to be mailed beginning in June.

• These estimates are based on sole wage earners who claim only the basic personal amount, CPP and EI non-refundable credits and spousal amount where there is a non-working spouse or equivalent- to-spouse.

NOTE: For further 2003-04 budget information, visit the Department of Finance Web site at www.gov.ns.ca/finance .