The ceiling on the capital cost of passenger vehicles for capital cost allowance (CCA) purposes has increased from $30 000 to $34 000 (plus applicable federal and provincial sales taxes) for non-zero-emission vehicles and from $55 000 to $59 000 for eligible zero-emission passenger vehicles. These ceilings restrict the cost of a vehicle on which CCA may be claimed for business purposes. The limit on deductible leasing costs has also increased from $800 to $900 per month (plus applicable federal and provincial sales taxes). This limit, which ensures that the level of deductions for leased and purchased vehicles is consistent, is one of two restrictions on the deduction of automobile lease payments. A separate restriction prorates deductible lease costs where the value of the vehicle exceeds the capital cost ceiling. The limit on the deduction of tax-exempt allowances paid by employers to employees increased from 59¢ to 61¢ per kilometer for the first 5,000 kilometers driven and from 53¢ to 55¢ for each additional kilometer. The allowance amounts reflect the key cost components of owning and operating an automobile, such as depreciation, financing, maintenance, and fuel costs. The maximum allowable interest deduction for amounts borrowed to purchase an automobile remains at $300. This limit reflects the reasonable cost of financing a vehicle for business purposes. The general prescribed rate used to determine the taxable benefit relating to the personal portion of automobile operating expenses paid by employers will increase by 2¢ to 29¢ per kilometer. For taxpayers employed principally in selling or leasing automobiles, the prescribed rate will increase by 2¢ to 26¢ per kilometer. The amount of the benefit reflects the costs of operating an automobile. The additional benefit of having an employer-provided vehicle available for personal use (i.e., the automobile standby charge) is calculated separately and is also included in the employee’s income.