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Statutes of Newfoundland and Labrador 2015


CHAPTER 14

AN ACT TO AMEND THE INCOME TAX ACT, 2000 NO. 2

(Assented to June 23, 2015)

Analysis


        1.   S.34 Amdt.
Harmonized sales tax credit

        2.   S.42 Amdt.
Research and development tax credit

        3.   S.45 Amdt.
Film or video tax credit

        4.   S.46.3 Added
Interactive digital media tax credit

        5.   Commencement


Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:

SNL2000 cI-1.1
as amended

        1. Subsection 34(4) of the Income Tax Act, 2000 is repealed and the following substituted:

             (4)  The amount referred to in subsection (3) shall be the total of

             (a)  the amount by which the total of

                      (i)  $300,

                     (ii)  $60 for a person who is the qualified relation of the individual for the year, and

                    (iii)  the product obtained when $60 is multiplied by the number of qualified dependants of the individual for the year,

exceeds

                    (iv)  5% of the amount by which the individual’s adjusted income for the year exceeds $30,000; and

             (b)  the amount calculated in accordance with the regulations.

 

        2. Section 42 of the Act is amended by adding immediately after subsection (2.1) the following:

         (2.2)  A taxpayer is not entitled to claim a deduction under subsection (2) and a credit under section 46.3 with respect to the same expenditure.

 

        3. Section 45 of the Act is amended by adding immediately after subsection (3) the following:

         (3.1)  Where an expenditure can be considered to be a qualifying expenditure with respect to a credit under this section and section 46.3, that expenditure shall be allocated proportionately between the two tax credits in the manner prescribed in the regulations.

 

        4. The Act is amended by adding immediately after section 46.2 the following:

Interactive digital media tax credit

   46.3 (1) In this section

             (a)  "eligible corporation" means a corporation which satisfies the conditions prescribed in the regulations;  

             (b)  "eligible product" means an interactive digital media product developed by an eligible corporation for or during an eligible project

                      (i)  which satisfies the conditions prescribed in the regulations, and

                     (ii)  for which, in the opinion of the minister or in the opinion of a person so designated by the minister, public financial support would not be contrary to public policy;

             (c)  "eligible project" means a project of an eligible corporation to develop an eligible product which satisfies the conditions prescribed in the regulations; and

             (d)  "qualifying expenditure" means the eligible proportion of salaries and remuneration paid by an eligible corporation for or during an eligible project as prescribed in the regulations.

             (2)  An eligible corporation, or a person acting on behalf of an eligible corporation, may apply to the minister for a tax credit in respect of a qualifying expenditure.

             (3)  The minister may give a tax credit to an eligible corporation which applies under subsection (2) or on whose behalf an application is made under subsection (2).

             (4)  A tax credit given under subsection (3) shall be calculated in the manner prescribed by the regulations.

             (5)  A tax credit shall be deducted against the tax which is otherwise payable under this Act.

             (6)  A taxpayer is not entitled to claim a credit under subsection (5) and a deduction under section 42 with respect to the same expenditure.

             (7)  Where an expenditure can be considered to be a qualifying expenditure with respect to a credit under this section and section 45, that expenditure shall be allocated proportionately between the two tax credits in the manner prescribed in the regulations.

             (8)  Where the tax credit calculated in accordance with this section exceeds the tax otherwise payable under this Act, the minister may pay the amount of the excess to the eligible corporation in a manner prescribed in the regulations.

             (9)  The Lieutenant-Governor in Council may make regulations

             (a)  respecting the manner of applying for a tax credit under this section;

             (b)  establishing the criteria for determining who or what is  

                      (i)  an eligible corporation,

                     (ii)  an eligible product,

                    (iii)  an eligible project, and

                    (iv)  a qualifying expenditure;

             (c)  respecting the issuance of and the grounds for revocation of certificates of eligible corporations;

             (d)  respecting the issuance of and the grounds for revocation of tax credit certificates;

             (e)  limiting the value of the tax credits which an eligible corporation may receive under this section in a taxation year;

             (f)  respecting the manner of calculating the amount of a tax credit that may be paid to an eligible corporation;

             (g)  setting limits on the values of qualifying expenditures;

             (h)  prescribing penalties for failure to comply with the regulations;

              (i)  prescribing the manner in which a credit under this section may be administered, including how a credit under this section may operate together with another tax credit allowable under this Act;

              (j)  defining or further defining a term used in this section; and

             (k)  generally to give effect to the purpose of this section.

          (10)  Regulations under subsection (9) may be made with retroactive effect.

Commencement

        5. (1) Section 1 of this Act comes into force on January 1, 2016.

             (2)  Sections 2, 3 and 4 of this Act are considered to have come into force on January 1, 2015.