And, believe it or not, corporate tax rates are also quite a bit higher in California:
British Columbia has one of North America’s most competitive tax climates for businesses. Personal tax rates are also competitive.
Our effective corporate tax rate for many industries is significantly lower than in other West Coast jurisdictions. In the digital media sector, for example, British Columbia’s rate is 11.8 per cent. Similar businesses on the west coast of the United States typically pay more than 30 per cent.
In addition, British Columbia’s general corporate income tax rate is 11 per cent, among the lowest in Canada. Our combined federal-provincial rate is 26 per cent, among the lowest in G7 countries.
Combined federal-provincial corporate income tax rates – 2013
| British Columbia |
26.00% |
| Ontario |
26.50% |
| California |
40.75% |
| Washington |
35.00% |
| Oregon |
39.94% |
Sources: PwC research, December 31, 2012
British Columbia Budget and Fiscal Plan 2013
On the first $500,000 of business income, British Columbia taxes businesses at just 2.5 per cent. Since 2002, this $500,000 threshold has increased 150 per cent, allowing businesses to pay less tax on a larger amount of income.