B.C. Provincial budget tax changes

On February 17, 2026, the B.C. government announced changes to the provincial tax laws. See the Budget and Fiscal Plan to read a full summary of all the tax changes for Budget 2026.

Budget 2026 introduces changes for:

• Income taxes
• Property taxes
• Sales taxes
• Speculation and vacancy tax
• Technical amendments to various acts

Learn more below.

Income taxes

Lowest personal income tax rate and basic personal income tax credits

Effective for the 2026 and subsequent taxation years, the lowest personal income tax rate is increased from 5.06 percent to 5.60 percent. This increased rate will apply to the first $50,363 of taxable income for 2026, and will appear on pay cheques after July 1, 2026, when payroll withholdings are updated.

Effective for the 2026 and subsequent taxation years, the applicable percentage for the basic personal income tax credits is also increasing from 5.06 per cent to 5.60 per cent.

This will increase the amount of tax credits that can be claimed under the basic personal amount, age amount, and other basic non-refundable income tax credits to fully or partially offset the tax rate increase for taxpayers.

B.C. tax reduction credit amount 

Effective for the 2026 taxation year, the maximum B.C. tax reduction credit is increased by $115 to $690. 

Personal income tax brackets and non-refundable tax credits 

Effective for the 2027 through the 2030 taxation years, indexation for personal income tax brackets and non-refundable tax credits is temporarily paused at their 2026 levels. Indexation will resume for 2031 and subsequent taxation years. 

Scientific research and experimental development tax credit 

The scientific research and experimental development (SR&ED) tax credit is amended to align with recent changes to the federal SR&ED tax incentive program and expand the refundable credit to eligible Canadian public corporations. 

Effective on royal assent, the expiration date for scientific research and experimental development tax credit will be removed. 

Tax credit for volunteer firefighters and search and rescue volunteers 

Effective for the 2026 and subsequent taxation years, the amount an individual can claim for the tax credit for volunteer firefighters and search and rescue volunteers is increased from $3,000 to $6,000. 

New children and youth disability supplement 

A new children and youth disability supplement for the B.C. family benefit is introduced for payments beginning July 1, 2027. 

The supplement payment will be delivered monthly alongside the B.C. family benefit.

Farmers’ food donation tax credit 

Effective on royal assent, the expiration date for the farmers’ food donation tax credit will be removed.

See the following for details: 

• B.C. farmers' food donation income tax credit (corporate)
• B.C. farmers' food donation income tax credit (personal)

Mining exploration tax credit 

Subject to legislative amendments to the Income Tax Act (Canada), effective November 4, 2025, the Province will amend the B.C. mining exploration tax credit to clarify that expenses incurred for the purpose of determining the quality of a mineral resource in British Columbia does not include expenses related to determining the economic viability or engineering feasibility of the mineral resource.

See the following for details: 

• Mining exploration tax credit (corporate)
• Mining exploration tax credit (personal)

Production services tax credit 

Effective on royal assent, the requirement for corporations to file a notice of intent to claim the production services tax credit is eliminated for notices due on or after February 17, 2026. Notices that were required to have been filed prior to February 17, 2026 will continue to be subject to the previous requirements and timelines.

Effective March 1, 2026, the accreditation certificate fee for the production services tax credit is increased to $19,000 for corporations that began principal photography after December 31, 2024 and apply for certification on or after March 1, 2026. The major production tax credit certificate fee is set at $5,000.

Film incentive B.C. and production services tax credit 

Effective on royal assent, the time in which a corporation must file a claim for either the film incentive B.C. tax credit or the production services tax credit is extended from 18 months to 36 months after the end of the corporation’s taxation year. The new time limit applies to claims which would otherwise have been required to be filed on or after February 17, 2026.

Effective on royal assent, corporations claiming the Film Incentive B.C. tax credit are no longer required to file a completion certificate with the Canada Revenue Agency that would have been due on or after February 17, 2026. 

New B.C. manufacturing and processing investment tax credit 

Effective April 1, 2026, a new temporary refundable B.C. manufacturing and processing investment tax credit is introduced for investments made by B.C. Canadian-controlled private corporations in buildings and machinery and equipment used for manufacturing and processing in B.C., subject to exclusions and expenditure limitations in the legislation.

Book publishing tax credit 

Effective March 31, 2026, the expiration date for the book publishing tax credit will be removed.

Shipbuilding and ship repair industry tax credit 

Effective on royal assent, the shipbuilding and ship repair industry tax credit is extended for one year to the end of 2027. 

Property taxes

Northern and rural home owner benefit 

Effective for the 2027 and subsequent taxation years, the $200 northern and rural home owner benefit is repealed. The northern and rural home owner benefit was introduced as part of the home owner grant program to offset the effects of the carbon tax, which has now ended. The regular home owner grant will be $570 for properties for all areas of the province.

Property tax deferment program

Effective for the 2026 and subsequent taxation years, the property tax deferment program interest rate terms are amended. The interest rates for the Regular and Families with children programs are harmonized and increased to an annual rate of prime plus two per cent compounding monthly.

Purpose-built rental exemptions 

Retroactive to January 1, 2025, the purpose-built rental exemptions from the property transfer tax are expanded to apply to newly constructed purpose-built rental buildings leased for a maximum of 24 months before their first taxable transaction is registered at the Land Title and Survey Authority of British Columbia. 

Additional school tax rates 

Effective for the 2027 and subsequent taxation years, the additional school tax rates on residential properties valued over $3 million are increased.

The tax rate that applies to the residential portion assessed between $3 million and $4 million is increased from 0.2 percent to 0.3 percent, and the tax rate that applies to the portion of residential assessed value that exceeds $4 million is increased from 0.4 percent to 0.6 percent.

Rural area property tax rates 

The 2026 rural area property tax rates for the residential and non-residential classes will be set in the spring. Starting in 2026, the method used to increase rural area property taxes will be the three-year average annual change in provincial nominal Gross Domestic Product. This policy replaces the longstanding rate-setting policy in place since 2005.

School tax rates 

The 2026 provincial school tax rates for the residential and non-residential classes will be set in the spring. Starting in 2026, the method used to increase school property taxes on the residential and non-residential classes will be the three-year average annual change in provincial nominal Gross Domestic Product. This policy replaces the longstanding rate-setting policy in place since 2005.

Police tax rate 

Effective for the 2026 tax year, the police tax rate is set to recover 33 per cent of legislated costs, after policy-based deductions, consistent with the policy in place since 2023.

Sales taxes

Provincial sales tax (PST)

PST expanded to certain professional services 

Effective October 1, 2026, the following services will become subject to PST: 

• Accounting services, including bookkeeping and assurance services
• Architectural services
• Engineering and geoscience services
• Non-residential real estate services, including trading services, rental property management services and strata management services
• Security services, including private investigation services

Businesses that provide these services will need to register to collect and remit PST.

See the following for details:

• Notice 2026-001: Notice to providers of professional services

PST exemptions eliminated on certain goods and services

Effective October 1, 2026, PST exemptions will be eliminated on the following:

• Clothing patterns, yarn, natural fibres, synthetic thread, and fabric that are commonly used in making or repairing clothing
• Services related to clothing and footwear (basic laundry services will remain exempt)
• Basic cable television services, residential landline telephone services, and toll-free telephone services

More information, including transitional rules, will be provided closer to October 1, 2026. Subscribe to receive email notifications when we update PST information on our website.

PST exemption for purchasers

Effective February 18, 2026, the Provincial Sales Tax Act and Provincial Sales Tax Exemption and Refund Regulation are amended to enable sellers of goods to provide a point-of-sale exemption or refund within 180 days to businesses purchasing goods for business use outside of the province. The new exemption will allow the purchaser to ship the goods from B.C. instead of requiring the seller to do so.

See the following for details:

• PST exemptions and documentation requirements
• Small business guide to PST
• Bulletin PST 309, PST and Non-Residents (PDF, 310KB)
• Bulletin PST 400, PST Refunds (PDF, 460KB)

Speculation and vacancy tax

Speculation and vacancy tax rate

Effective for the 2027 and subsequent taxation years, the speculation and vacancy tax rate for foreign owners and untaxed worldwide earners, as well as others specified under the Speculation and Vacancy Tax Act currently taxed at the highest rate (3 per cent as of January 1, 2026), will increase from 3 per cent to 4 per cent.

The change will apply to the speculation and vacancy tax payable by these property owners based on the use of their residential properties during the 2027 calendar year and onward, and will not impact taxpayers declaring based on the use of their residential properties in 2026 or before.

Technical amendments for various acts

Effective August 4, 2023, the Income Tax Act is amended to allow Canada Revenue Agency to reduce renounced amounts for the B.C. mining flow-through share tax credit and the mining exploration tax credit.

See the following for details: 

• Mining exploration tax credit frequently asked questions (corporate)
• Mining exploration tax credit frequently asked question (personal)

Effective on royal assent, the School Act and the Taxation (Rural Area) Act are amended to clarify the definition of “eligible corporation” as including a corporation that is a wholly-owned subsidiary of other eligible corporations, and including trustees of trusts that are for the benefit of more than one First Nation.

Effective on royal assent, the Property Transfer Tax Act is amended to allow a person to appeal the imposition of a gross negligence penalty to the Minister of Finance.

Effective on royal assent, the Property Transfer Tax Act is amended to extend the limitation period for charging a person with an offence from 1 to 6 years, aligning the limitation period for all offences under the Act.

Effective on royal assent, the Property Transfer Tax Act is amended to clarify that residential property is defined as property that is classified as class 1 on the assessment roll for the applicable year.

Effective June 30, 2026, the Assessment Act is amended to clarify the existing practice that BC Assessment is not required to consider the effect of private encumbrances affecting use when determining the assessed value of a property.

Effective January 1, 2027 and subsequent taxation years, the Speculation and Vacancy Tax Regulation is amended so that property owners who do not declare by the March 31 due date will be charged a $250 non-refundable late declaration penalty. 

Effective on royal assent, the Speculation and Vacancy Tax Act is amended to remove a property owner’s right to appeal an assessment arising from their own declaration that an exemption does not apply to their property under the Act.

Historical budget information

• 2025 Budget tax changes
• 2024 Budget tax changes
• 2023 Budget tax changes
• 2022 Budget tax changes
• 2021 Budget tax changes
• 2020 Budget tax changes
• 2019 Budget tax changes
• 2018 Budget tax changes
• 2017 Budget tax changes
• 2016 Budget tax changes
• 2015 Budget tax changes
• 2014 Budget tax changes
• 2013 Budget tax changes