The new Ontario Economic Plan was released by the Ministry of Finance on March 23, 2023, following the speech by the Finance Minister, Peter Bethlenfalvy.
Through the 2023-2024 budget, the re-elect Ontario government continues its approach from the past years to build a strong fiscal foundation, while supporting people and businesses. This year’s measures revolve around five major areas: the economy, infrastructure, jobs, affordable living, and services while aiming to eliminate the deficit for the years to come.
FI Group provides an overview of the main elements related to R&D and innovation in connection with this new economic plan.
The new economic plan did not lead to major changes in the methods for allocating tax credits for SR&ED. The rules during the previous year, therefore, remain in force regarding the obtaining and monitoring of these tax credits.
The SR&ED tax measures at the provincial level continue to consist of the OITC (8% of eligible R&D expenditures for qualifying corporations), ORDTC (3.5% of eligible R&D expenditures) and OBRITC (20% of qualified expenditures).
The government’s commitment to supporting homegrown automotive innovation is paving the way towards a greener and more sustainable future while creating new job opportunities and stimulating economic growth in Canada.
Ontario is focusing on growing its life sciences sector, which has attracted nearly $3 billion in investments by global biomanufacturers over the past two and a half years.
The government is focused on investing in critical technologies to create jobs and help businesses in Ontario. The initiatives aim at six technologies: 5G, AI, quantum, robotics, blockchain, and cybersecurity. To achieve that, the government is investing $107 million in critical technology initiatives to drive commercialization and support job growth.
Regional Innovation Centre hubs are crucial in providing support and resources for entrepreneurs to start and grow their businesses. The government aims to promote collaboration between Regional Innovation Centres and other innovation organizations in the area, enabling entrepreneurs to access the support they need to fuel their businesses. With continued growth and opportunities for innovation and entrepreneurship in the region, this expansion is expected to spur economic growth and create new job opportunities. To achieve this, the government is providing Invest Ottawa with an additional $1 million per year for three years, starting in 2023-24, to expand into a Regional Innovation Centre hub for Eastern Ontario.
The manufacturing sector in Ontario has seen a decline in employment, but the government has attracted investments in auto and clean steel manufacturing since 2018. To further support local businesses, the government is proposing the Ontario Made Manufacturing (OMM) Investment Tax Credit.
The Ontario government is investing in the Critical Minerals Strategy via the Ontario Junior Exploration Program. This program, launched in 2021, finances early exploration projects of up to $200,000 of eligible costs for critical and precious mineral exploration and development.