WATCH: The provincial government has finally unveiled how its going to tax the liquefied natural gas industry. Keith Baldrey explains the change.
The provincial government has announced its tax rate on LNG projects, and it’s half of what was proposed earlier this year.
Effective January 1, 2017, the tax rate on net income will be 3.5 per cent. It was originally proposed to be seven per cent, but the province says market conditions have changed.
The tax will only be 1.5 per cent while start-up costs are paid.
In 2037, the tax rate will increase to 5 per cent. The province says this ensures that proponents will “have time to build a strong foundation in the communities in which they operate.”
The province says their LNG tax framework is competitive with competing jurisdictions, such as the U.S. and Australia.
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