Enterprise Saskatchewan

The provincial government made the largest single-year personal income tax reduction in its history in 2008.

Saskatchewan’s general corporate income tax rate has come down five percentage points in the past few years, making it one of the lowest in Canada. The general rate is now 12%, which is reduced to 10% for most processing and manufacturing operations.

The province has eliminated its general corporate capital tax for new capital investment. There are no payroll taxes or health benefit charges.

The small business income tax rate is 4.5% and applies to the first $500,000 of business income, and provincial municipalities are able to offer discretionary five-year property tax abatements.

Of the Canadian provinces with a provincial sales tax, Saskatchewan’s rate of 5% is the lowest.

The province offers a 5% refundable investment tax credit on manufacturing and processing equipment, and there is no sales tax charged on direct agents used in manufacturing and processing. In 2009, the province introduced a 15% tax credit for research and development expenditures.

Business income or profits tax paid by a Canadian corporation to a foreign country are eligible for a foreign tax credit against federal corporate income tax, which allows corporations to avoid double taxation on income from foreign sources.