2026 Nova Scotia Budget Highlights
On February 23, 2026, Nova Scotia’s Minister of Finance and Treasury Board, John Lohr, tabled the province’s 2026-27 budget. We have highlighted selected measures from the budget that affect individuals and small businesses in Nova Scotia.
INDIVIDUALS
Personal Tax Rates
The budget did not propose any changes to individual income tax rates. The province has continued the indexation of tax brackets for the 2026 taxation year.
| 2025 Taxable Income | 2026 Taxable Income | Tax Rate |
|---|---|---|
| $0 to $30,507 | $0 to $30,995 | 8.79% |
| $30,508 to $61,015 | $30,996 to $61,991 | 14.95% |
| $61,016 to $95,883 | $61,992 to $97,417 | 16.67% |
| $95,884 to $154,650 | $97,418 to $157,124 | 17.50% |
| Over 154,650 | Over $157,124 | 21.00% |
Top Combined Nova Scotia and Federal Rates – 2026
| Other/Interest/ Salary/Pension | Capital Gains | Eligible Canadian Dividends | Non-eligible Canadian Dividends |
|---|---|---|---|
| 54.00% | 27.00% | 41.58% | 49.99% |
Top rates apply to taxable income over $258,482 ($253,414 for 2025) based on known federal and provincial rates as of February 23, 2026.
Personal Income Tax Measures
- Beginning April 1, 2026, the budget introduces a new vaping product duty which will be harmonized with the federal government as follows:
- $1.12 per 2ml/gr of vaping substance for the first 10ml/gr of vaping substance in a device or container, and
- $1.12 per 10ml/gr for any additional amount.
- The budget introduces a new Electric and Hybrid Vehicle Levy, effective October 1, 2026, to be paid when such vehicles are first registered, and then every two years thereafter when the vehicle registration is renewed. Fully electric vehicle owners will pay $500 every two years, and electric-hybrid vehicle owners will pay $250 every two years.
BUSINESSES
Corporate Tax Rates
The budget did not propose any changes to the provincial corporate income tax rates or the $700,000 small business income threshold. The calendar year rates below reflect a December 31st year end.
Nova Scotia Corporate Tax Rates
| Income Type | Provincial | Federal | Combined Rates Calendar 2026 |
|---|---|---|---|
| General corporate | 14.00% | 15.00% | 29.00% |
| Small business – to $500,000 | 1.50% | 9.00% | 10.50% |
| Small business –$500,000 to $700,000 | 1.50% | 15.00% | 16.50% |
| CCPC* investment | 14.00% | 38.67% | 52.67% |
| Non-CCPC investment | 14.00% | 15.00% | 29.00% |
Based on known federal and provincial rates as of February 23, 2026 *Canadian Controlled Private Corporation
Business Income Tax Measures
- The budget will extend the sunset date for the Capital Investment Tax Credit to December 31, 2035, and authorize the credit for qualified property acquired after the sunset date provided certain conditions are met.
- The Financial Institutions Capital Tax will be increased to 6% (from 4%), effective for tax years starting on or after November 1, 2026. The tax is levied on taxable capital applicable to banks, loans, and trust corporations having a permanent establishment in the province. The tax does not apply to credit unions or life insurance corporations.
Refer to the 2026 Nova Scotia Budget for further details.
This has been prepared by the Total Wealth Solutions Group of Raymond James Ltd., (RJL). Statistics and factual data and other information are from sources RJL believes to be reliable, but their accuracy cannot be guaranteed. It is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of securities nor is it meant to replace legal, accounting, taxation or other professional advice. We are not tax advisors, and we recommend that clients seek independent advice from a professional advisor on tax-related matters. The information is furnished on the basis and understanding that RJL is to be under no liability whatsoever in respect thereof. This is intended for distribution only in those jurisdictions where RJL and the author are registered. Securities-related products and services are offered through Raymond James Ltd., Member of the Canadian Investor Protection Fund. Insurance products and services are offered through Raymond James Financial Planning Ltd., which is not a Member of the Canadian Investor Protection Fund.
