Manitoba 2024 Budget Highlights

Manitoba Minister of Finance Adrien Sala tabled the province’s 2024 budget on Tuesday, April 2, 2024. This year’s budget, titled One Future. One People. One Manitoba., is focused on rebuilding healthcare, lowering costs for families, creating healthier families and safer communities, and growing Manitoba’s economy.

Personal income tax measures

Personal income tax rates

The budget will provide tax relief to middle-class families by raising income tax bracket thresholds and continuing to increase the Basic Personal Amount (BPA) — a non-refundable tax credit Manitoba residents claim on their personal income tax return.

Tax bracket thresholds were increased to $47,000 and $100,000 in 2024 and will return to annual indexing in 2025. The BPA increased to $15,780 because of indexing in 2024 and is projected to further increase to $16,206 in 2025.

Beginning with the 2025 tax year, Manitoba will phase out the BPA over a net income range of $200,000 to $400,000.

No new personal income tax rate changes were announced in this year’s budget.

The top marginal personal income tax rate for Manitoba is 17.40 percent for 2024. The current top combined federal and Manitoba marginal rates for 2024 are summarized below:

Renters Tax Credit

As part of a four-year commitment to fully restoring the Renters Tax Credit, an increased Renters Tax Credit of up to $575 (previously $525) will be provided for 2025. The seniors’ top-up will also increase to a maximum of $328 (previously $300).

Fertility Treatment Tax Credit

The maximum annual eligible expense amount under the Fertility Treatment Tax Credit is doubled from $20,000 to $40,000 for the 2024 tax year. This doubles the available annual credit amount from $8,000 to $16,000.

Business income tax measures

Corporate income tax rates

No new corporate income tax rate changes were announced in this year’s budget. The current corporate income tax rates for 2024 are summarized below:

M&P – Manufacturing & Processing

* Rates applicable to income not eligible for the temporary rate reduction for manufacturers of qualifying zero-emission technology

Rental Housing Construction Tax Credit

A new Rental Housing Construction Tax Credit will be introduced effective for the 2024 tax year. The tax credit will provide $8,500 for the construction of new market-rate rental units and $13,500 for units classified and maintained as affordable units for at least 10 years.

Construction must commence on or after January 1, 2024, to be eligible for the tax credit.

The Rental Housing Construction Tax Credit will be fully refundable to non-profit organizations. For other businesses, $8,500 will be fully refundable on all units, with an additional $5,000 non-refundable credit available over 10 years for affordable units.

Elimination of the Data Processing Investment Tax Credits

The Data Processing Investment Tax Credits will be eliminated for the 2025 tax year. This refundable credit for eligible data processing centre corporations offset some of the cost of data processing buildings and property.

Extension of the Cultural Industries Printing Tax Credit

The Cultural Industries Printing Tax Credit scheduled to expire on December 31, 2024, is extended for one year to December 31, 2025. This tax credit provides Manitoba’s printing industry with a 35 percent refundable credit on salary and wages paid to Manitoba employees.

Indirect tax measures

Sales tax registration threshold

Effective January 1, 2024, the sales tax registration threshold will be increased for taxable sales from $10,000 to $30,000. This change is aligned with the federal government’s GST/HST threshold of $30,000.

Sales tax commissions

Currently, businesses in Manitoba reporting less than $3,000 in sales tax in a filing period are eligible for a sales tax commission. The budget proposes to eliminate this commission for any filing period ending after April 2024.

Removing PST on new affordable housing units

To boost the development of both affordable and market rental units in Manitoba, the budget proposes to remove PST on new affordable housing units.

Other tax measures

School tax measures

The School Tax Rebate and Education Property Tax Credit will be replaced with a new Homeowners Affordability Tax Credit of up to $1,500 on principal residences for the 2025 tax year. The enhancement will effectively eliminate education property taxes for homes with assessed values of $285,000 and below.

Additionally, while the Seniors School Tax Rebate will be maintained for the 2025 tax year, the Education Property Tax Credit seniors’ top-up and School Tax Credit will be eliminated. Homeowners with homes that have an assessed value of $437,000 and higher will receive less in credits in 2025 compared to prior years.

The School Tax Rebate for farm properties will remain at 50 percent. However, the rebate for all other commercial properties will be eliminated.

Vaping tax

The province intends to sign a Coordinated Vaping Product Taxation Agreement with the federal government. The federal government implemented an excise duty on vaping products effective October 1, 2022, and invited provinces and territories to sign an agreement under which an additional duty equal to the federal rate would apply. The new, doubled rates will be applied in Manitoba effective January 1, 2025.

Gas tax cut extension

The budget announces an extension of the gas tax cut implemented on January 1, 2024, for an additional three months until September 30, 2024. The gas tax rate will remain at zero cents per litre on gasoline, diesel and marked gasoline. Marked diesel will continue to be tax-exempt.

Consumer rebates for security and camera systems

The budget announces a $300 rebate for Manitobans purchasing or upgrading a home or business security system. Manitobans can purchase or install a home or business security system of their choice and apply to the government for a consumer refund of up to $300.

Electric vehicle incentive

A new Electric Vehicle (EV) rebate is introduced for all Manitobans who purchase new or used EV or plug-in hybrid vehicles. Individuals may be eligible for a rebate of up to $4,000 for new and $2,500 for pre-owned EVs purchased between August 1, 2023, to March 31, 2026. The rebate, available once per vehicle and once per purchaser/lessee, will be applied at registration of the vehicle with Manitoba Public Insurance.

Doubling of the prenatal benefit

The budget proposes to double the prenatal benefit from $81.41 per month to $162.82 per month.

Tax administration

Various administrative tax measures are announced in the budget, including:

• Homeowners Affordability Tax Credit and Renters Tax Credit for mobile homeowners: This measure clarifies that mobile homeowners may claim 50 percent of license fees and 10 percent of land rental payments for the Education Property Tax Credit in 2024. Additionally, mobile homeowners are ineligible for the Renters Tax Credit.
• Qualified Disability Trusts: A recovery tax is established to retroactively negate the preferential treatment in the case of trust funds not going to the intended qualified beneficiary.
• Land transfer tax administrative penalties: Changes proposed to allow the issuance of administrative penalties in certain cases of non-compliance.
• Interactive Digital Media Tax Credit: Changes are made to clarify that expenses incurred in relation to eligible projects must be claimed in the taxation year in which the costs were incurred. Additionally, the budget has established a new sub-category of qualifying corporations under the credit specifically for Manitoba video game companies. Qualifying corporations in this new sub-category will be exempt from having to apply for a certificate of eligibility prior to project work commencement.
• Retail sales tax: The budget has implemented various technical clarifications, including eliminating the restriction for sales tax refunds on vehicles bought in Manitoba and subsequently sold out-of-province within six months.
• Provincially administered tax audit periods: The tax audit periods will be limited to a maximum of six years from the date of notification. However, this will not apply when taxes have been collected but not remitted or where a person made a misrepresentation. A Notice of Assessment will also be required to be issued upon completion of all tax audits.
• Tax clearance certificate fee and advance ruling fee: Effective May 1, 2024, the $50 tax clearance certificate fee and the advance ruling fee will be eliminated for provincially administered tax statutes. An advance ruling can be requested by a taxpayer if their business transaction is deemed to be done as part of a tax avoidance transaction.
• Repealing the Succession Duty Act: Estates of persons who died between 1971 and 1977 will no longer be taxed under the Succession Duty Act.
• Oil and Gas production tax recordkeeping requirements: The four-year recordkeeping requirement for operators is changed to six years to align with the tax record retention period of the Canada Revenue Agency.
• Forfeit of unmarked tobacco: Unmarked tobacco that is discovered during a search of a building, vehicle or container done under a warrant will be seized and forfeited to the Crown.

More details and highlights of the 2024 Manitoba budget can be found here.