NDP would reinstate tax credit for investing in union-sponsored VC firms
Federal NDP leader Tom Mulcair called the Conservative's move to phase out the cut "a purely ideological decision"
MONTREAL—Tom Mulcair says an NDP government would reinstate a tax credit for people who invest in union-sponsored venture capital firms.
A Montreal crowd of business and union leaders listened as the NDP leader outlined his party’s plan for sustainable economic growth, which includes bringing back the 15 per cent tax credit.
The Conservative government announced in 2013 that the tax credit program would be phased out by 2017.
They said the program was “criticized by academics, international organizations as well as venture capital industry stakeholders as being an ineffective means of stimulating a healthy venture capital sector.”
The government replaced it with a $400-million “Venture Capital Action Plan.”
Mulcair called the cut “a purely ideological decision” that “hurts the economy” during a speech at the Board of Trade of Metropolitan Montreal.
He added the 15 per cent tax credit “helps working families to save and invest in the small and medium sized businesses that are the backbone of our regional economies.”
The Liberal Party of Canada made a similar announcement to reinstate the tax credit in February.
An example of a union-sponsored venture capital corporation is Quebec Federation of Labour’s Solidarity Fund, which was created in 1983 by one of the province’s largest labour unions.
The fund invests mainly outside the province’s large cities and in projects that have difficulty securing financing.
The NDP says it will bring back the program which gave a 15 per cent federal tax credit for investments of up to $5,000 in union-sponsored venture capital firms.
A spokesman for Finance Minister Joe Oliver said in an email the credit “was not working to produce jobs and growth.”
Mulcair also reiterated earlier promises to cut the small business tax rate by two points to 9 per cent.
Additionally, an NDP government would boost funding for infrastructure by $400 million over four years to $3.7 billion, he said.
Mulcair added he’ll also transfer an additional 1 per cent of the gas tax to the provinces and end the Conservative government’s latest income-splitting proposal, which he says only benefits the richest families.
The federal NDP is riding high in the polls that suggest they are in first place in Quebec and have a strong chance at winning government in the fall.
Mulcair will deliver another speech to Economic Club of Canada in Toronto next Tuesday.