Nova Scotia Provincial Budget

The 2014 Nova Scotia provincial budget was tabled on April 3, 2014. The budget contained no new taxes or credits, but it did contain several adjustments.

HST Rate

In the 2012 provincial budget, the government announced that the HST rate would be reduced to 14% on July 1, 2014 and to 13% on July 1, 2015. In the 2014 budget, they announced that this reduction will not take place until suitable fiscal balances are achieved.

Graduate Retention Rebate

The Nova Scotia Graduate Retention Rebate will be eliminated as of the 2014 taxation year. As a replacement for this tax relief, the government announced the elimination of the provincial portion of interest on student loans, retroactive to 2008. They also promised to announce several new programs for graduates.

Nova Scotia Child Tax Benefit

The budget promised to expand the eligibility for the Nova Scotia Child Tax Benefit to include 130,000 more children. Details were not included in the budget documents.

2014 Changes Already in Place

As in most provinces, tax brackets and most provincial personal amounts are indexed. The Nova Scotia indexation factor for 2014 is 1.009 (i.e. a 0.9% increase). Nova Scotia’s basic personal amount increases to $8,481 but is still the second lowest in Canada (only Prince Edward Island has a lower amount). 

As a consequence of the federal change to the gross-up of small business dividends announced in the 2013 federal budget, the provincial dividend tax credit rate for such dividends is also adjusted automatically. Unlike several other provinces, Nova Scotia did not adjust the provincial rate which is tied to the federal rate. The provincial dividend tax credit rate decreases from 6.93% of the taxable dividend to 5.873%. This effectively increases the provincial taxes payable on small business dividends in 2014.