EXPLANATORY NOTES
The purpose of this Bill is to amend the Income Tax Act, 2000, to implement a tax credit for former post secondary students who are repaying their Newfoundland and Labrador portion of their student loans.
Clause 1 would add a proposed section 16.1 to the Act to provide the credit at 2 differing rates, one for disabled or single parent students and a second lower rate for all others. The base rates of 30% and 20% would reduce to 0% as income rises. This section would also provide that the credit would not be available for a tax return for a year of death, a return of a testamentary trust or a return respecting the business income of a deceased proprietor or partner. This tax credit would be available for the 2003 tax year only.
Clause 2 would amend section 23 of the Act, which specifies the priority of application for tax credits under the Act. This student loan credit would be applied before the equity tax credit and after all others.
Clause 3 would add to section 26 of the Act a reference to the proposed section 16.1. This would ensure that the rules respecting the calculation of allowable tax credits in the year of bankruptcy are also applied to section 16.1.
Clause 4 would add a Schedule to the Act listing rates of tax credits for various income levels.
A BILL
AN ACT TO AMEND THE INCOME TAX ACT, 2000
Analysis
1. S.16.1 Added
Student loan tax credit
2. S.23 Amdt.
Ordering of credits
3. S.26 Amdt.
Credits in year of bankruptcy
4. Sch. Added
Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:
SNL2000 cI-1.1
as amended
1. The Income Tax Act, 2000 is amended by adding immediately after section 16 the following:
Student loan tax credit
16.1 (1) Where, in a taxation year, an individual's taxable income does not exceed $50,000, there may be deducted from the tax otherwise payable by that individual an amount determined by the following formula:
A x B
where
A is the amount of principal paid in that year with respect to a loan issued under the Student Financial Assistance Act; and
B is the appropriate tax credit factor listed in Column A of the schedule to this Act.
(2) Notwithstanding subsection (1), where an individual is eligible to claim an amount under paragraph 9(1)(b) with respect to his or her child or an amount under section 12:
B is the appropriate tax credit factor listed in Column B of the Schedule to this Act.
(3) Subsections (1) and (2) shall not apply to a return filed by an individual under subsections 70(2), 104(23) or 150(4) of the federal Act.
(4) Subsections (1) and (2) shall apply only to a return filed by an individual for the 2003 taxation year.
2. Section 23 of the Act is amended by renumbering it as subsection 23(1) and by adding immediately after that subsection, the following:
(2) Where computing an individual's tax payable under this Act, the following sections shall be applied in the listed order:
(a) section 9;
(b) section 17;
(c) section 12;
(d) section15;
(e) section 13;
(f) section 14;
(g) section 18;
(h) section 11;
(i) section 10;
(j) section 16;
(k) section 20;
(l) section 21;
(m) section 19;
(n) section 33;
(o) section 47;
(p) section 16.1; and
(q) section 46.
3. Section 26 of the Act is amended by adding immediately after the word "Act" where it last appears, the words and figures "and shall be read to include a reference to section 16.1 of the Act".
4. The Act is amended by adding immediately after section 95 the following:
Schedule
Student Loan Tax Credit Factor Table
Taxable income |
Tax credit factor |
Taxable income |
Tax credit factor |
Taxable income |
Tax credit factor |
Taxable income |
Tax credit factor |
Equal to or over |
A |
B |
Equal to or over |
A |
B |
Equal to or over |
A |
B |
Equal to or over |
A |
B |
|
|
|
35,000 |
0.1625 |
0.2625 |
40,100 |
0.1243 |
0.2243 |
45,200 |
0.0860 |
0.1860 |
0 |
0.2000 |
0.3000 |
35,100 |
0.1618 |
0.2618 |
40,200 |
0.1235 |
0.2235 |
45,300 |
0.0853 |
0.1853 |
30,100 |
0.1993 |
0.2993 |
35,200 |
0.1610 |
0.2610 |
40,300 |
0.1228 |
0.2228 |
45,400 |
0.0845 |
0.1845 |
30,200 |
0.1985 |
0.2985 |
35,300 |
0.1603 |
0.2603 |
40,400 |
0.1220 |
0.2220 |
45,500 |
0.0838 |
0.1838 |
30,300 |
0.1978 |
0.2978 |
35,400 |
0.1595 |
0.2595 |
40,500 |
0.1213 |
0.2213 |
45,.600 |
0.0830 |
0.1830 |
30,400 |
0.1970 |
0.2970 |
35,500 |
0.1588 |
0.2588 |
40,600 |
0.1205 |
0.2205 |
45,700 |
0.0823 |
0.1823 |
30,500 |
0.1963 |
0.2963 |
35,600 |
0.1580 |
0.2580 |
40,700 |
0.1198 |
0.2198 |
45,800 |
0.0815 |
0.1815 |
30,600 |
0.1955 |
0.2955 |
35,700 |
0.1573 |
0.2573 |
40,800 |
0.1190 |
0.2190 |
45,900 |
0.0808 |
0.1808 |
30,700 |
0.1948 |
0.2948 |
35,800 |
0.1565 |
0.2565 |
40,900 |
0.1183 |
0.2183 |
46,000 |
0.0800 |
0.1800 |
30,800 |
0.1940 |
0.2940 |
35,900 |
0.1558 |
0.2558 |
41,000 |
0.1175 |
0.2175 |
46,100 |
0.0793 |
0.1793 |
30,900 |
0.1933 |
0.2933 |
36,000 |
0.1550 |
0.2550 |
41,100 |
0.1168 |
0.2168 |
46,200 |
0.0785 |
0.1785 |
31,000 |
0.1925 |
0.2925 |
36,100 |
0.1543 |
0.2543 |
41,200 |
0.1160 |
0.2160 |
46,300 |
0.0778 |
0.1778 |
31,100 |
0.1918 |
0.2918 |
36,200 |
0.1535 |
0.2535 |
41,300 |
0.1153 |
0.2153 |
46,400 |
0.0770 |
0.1770 |
31,200 |
0.1910 |
0.2910 |
36,300 |
0.1528 |
0.2528 |
41,400 |
0.1145 |
0.2145 |
46,500 |
0.0763 |
0.1763 |
31,300 |
0.1903 |
0.2903 |
36,400 |
0.1520 |
0.2520 |
41,500 |
0.1138 |
0.2138 |
46,600 |
0.0755 |
0.1755 |
31,400 |
0.1895 |
0.2895 |
36,500 |
0.1513 |
0.2513 |
41,600 |
0.1130 |
0.2130 |
46,700 |
0.0748 |
0.1748 |
31,500 |
0.1888 |
0.2888 |
36,600 |
0.1505 |
0.2505 |
41,700 |
0.1123 |
0.2123 |
46,800 |
0.0740 |
0.1740 |
31,600 |
0.1880 |
0.2880 |
36,700 |
0.1498 |
0.2498 |
41,800 |
0.1115 |
0.2115 |
46,900 |
0.0733 |
0.1733 |
31,700 |
0.1873 |
0.2873 |
36,800 |
0.1490 |
0.2490 |
41,900 |
0.1108 |
0.2108 |
47,000 |
0.0725 |
0.1725 |
31,800 |
0.1865 |
0.2865 |
36,900 |
0.1483 |
0.2483 |
42,000 |
0.1100 |
0.2100 |
47,100 |
0.0718 |
0.1718 |
31,900 |
0.1858 |
0.2858 |
37,000 |
0.1475 |
0.2475 |
42,100 |
0.1093 |
0.2093 |
47,200 |
0.0710 |
0.1710 |
32,000 |
0.1850 |
0.2850 |
37,100 |
0.1468 |
0.2468 |
42,200 |
0.1085 |
0.2085 |
47,300 |
0.0703 |
0.1703 |
32,100 |
0.1843 |
0.2843 |
37,200 |
0.1460 |
0.2460 |
42,300 |
0.1078 |
0.2078 |
47,400 |
0.0695 |
0.1695 |
32,200 |
0.1835 |
0.2835 |
37,300 |
0.1453 |
0.2453 |
42,400 |
0.1070 |
0.2070 |
47,500 |
0.0688 |
0.1688 |
32,300 |
0.1828 |
0.2828 |
37,400 |
0.1445 |
0.2445 |
42,500 |
0.1063 |
0.2063 |
47,600 |
0.0680 |
0.1680 |
32,400 |
0.1820 |
0.2820 |
37,500 |
0.1438 |
0.2438 |
42,600 |
0.1055 |
0.2055 |
47,700 |
0.0673 |
0.1673 |
32,500 |
0.1813 |
0.2813 |
37,600 |
0.1430 |
0.2430 |
42,700 |
0.1048 |
0.2048 |
47,800 |
0.0665 |
0.1665 |
32,600 |
0.1805 |
0.2805 |
37,700 |
0.1423 |
0.2423 |
42,800 |
0.1040 |
0.2040 |
47,900 |
0.0658 |
0.1658 |
32,700 |
0.1798 |
0.2798 |
37,800 |
0.1415 |
0.2415 |
42,900 |
0.1033 |
0.2033 |
48,000 |
0.0650 |
0.1650 |
32,800 |
0.1790 |
0.2790 |
37,900 |
0.1408 |
0.2408 |
43,000 |
0.1025 |
0.2025 |
48,100 |
0.0643 |
0.1643 |
32,900, |
0.1783 |
0.2783 |
38,000 |
0.1400 |
0.2400 |
43,100 |
0.1018 |
0.2018 |
48,200 |
0.0635 |
0.1635 |
33,000 |
0.1775 |
0.2775 |
38,100 |
0.1393 |
0.2393 |
43,200 |
0.1010 |
0.2010 |
48,300 |
0.0628 |
0.1628 |
33,100 |
0.1768 |
0.2768 |
38,200 |
0.1385 |
0.2385 |
43,300 |
0.1003 |
0.2003 |
48,400 |
0.0620 |
0.1620 |
33,200 |
0.1760 |
0.2760 |
38,300 |
0.1378 |
0.2378 |
43,400 |
0.0995 |
0.1995 |
48,500 |
0.0613 |
0.1613 |
33,300 |
0.1753 |
0.2753 |
38,400 |
0.1370 |
0.2370 |
43,500 |
0.0988 |
0.1988 |
48,600 |
0.0605 |
0.1605 |
33,400 |
0.1745 |
0.2745 |
38,500 |
0.1363 |
0.2363 |
43,600 |
0.0980 |
0.1980 |
48,700 |
0.0598 |
0.1598 |
33,500 |
0.1738 |
0.2738 |
38,600 |
0.1355 |
0.2355 |
43,700 |
0.0973 |
0.1973 |
48,800 |
0.0590 |
0.1590 |
33,600 |
0.1730 |
0.2730 |
38,700 |
0.1348 |
0.2348 |
43,800 |
0.0965 |
0.1965 |
48,900 |
0.0583 |
0.1583 |
33,700 |
0.1723 |
0.2723 |
38,800 |
0.1340 |
0.2340 |
43,900 |
0.0958 |
0.1958 |
49,000 |
0.0575 |
0.1575 |
33,800 |
0.1715 |
0.2715 |
38,900 |
0.1333 |
0.2333 |
44,000 |
0.0950 |
0.1950 |
49,100 |
0.0568 |
0.1568 |
33,900 |
0.1708 |
0.2708 |
39,000 |
0.1325 |
0.2325 |
44,100 |
0.0943 |
0.1943 |
49,200 |
0.0560 |
0.1560 |
34,000 |
0.1700 |
0.2700 |
39,100 |
0.1318 |
0.2318 |
44,200 |
0.0935 |
0.1935 |
49,300 |
0.0553 |
0.1553 |
34.100 |
0.1693 |
0.2693 |
39,200 |
0.1310 |
0.2310 |
44,300 |
0.0928 |
0.1928 |
49,400 |
0.0545 |
0.1545 |
34,200 |
0.1685 |
0.2685 |
39,300 |
0.1303 |
0.2303 |
44,400 |
0.0920 |
0.1920 |
49,500 |
0.0538 |
0.1538 |
34,300 |
0.1678 |
0.2678 |
39,400 |
0.1295 |
0.2295 |
44,500 |
0.0913 |
0.1913 |
49,600 |
0.0530 |
0.1530 |
34,400 |
0.1670 |
0.2670 |
39,500 |
0.1288 |
0.2288 |
44,600 |
0.0905 |
0.1905 |
49,700 |
0.0523 |
0.1523 |
34,500 |
0.1663 |
0.2663 |
39,600 |
0.1280 |
0.2280 |
44,700 |
0.0898 |
0.1898 |
49,800 |
0.0515 |
0.1515 |
34,600 |
0.1655 |
0.2655 |
39,700 |
0.1273 |
0.2273 |
44,800 |
0.0890 |
0.1890 |
49,900 |
0.0508 |
0.1508 |
34,700 |
0.1648 |
0.2648 |
39,800 |
0.1265 |
0.2265 |
44,900 |
0.0883 |
0.1883 |
50,000 |
0.0500 |
0.1500 |
34,800 |
0.1640 |
0.2640 |
39,900 |
0.1258 |
0.2258 |
45,000 |
0.0875 |
0.1875 |
50,001 |
0.0000 |
0.0000 |
34,900 |
0.1633 |
0.2633 |
40,000 |
0.1250 |
0.2250 |
45,100 |
0.0868 |
0.1868 |
|
|
|
©Earl G. Tucker, Queen's Printer
|