Bill 16: Income Tax Act, 2000 (Amdt.)

This bill most directly affects small business owners incorporated in Newfoundland and Labrador — think a local trades company, retail shop, or professional services firm that qualifies for the federal small business deduction under section 125. Their provincial corporate tax rate on eligible small business income will drop from 2.5% to 2% starting January 1, 2026, then to 1.5% in 2027, and finally to 1% in 2028, meaningfully reducing their annual tax bill in stages. Individual employees and self-employed residents across the province will also benefit from the higher basic personal amount ($13,094 rising to $15,000 in 2027), which reduces the amount of income subject to provincial tax. Volunteer firefighters and search and rescue volunteers — whether they run their own business or work for someone else — will see the eligible amount for their tax credit double from $3,000 to $6,000.