Budget 2013 stays the course for industry and small business
In a budget document that was short on details and even shorter on new spending, several policies that impact manufacturers directly were extended or enhanced
OTTAWA—In a budget document that was short on details and even shorter on new spending, several policies that impact manufacturers directly were extended or enhanced.
Capital Cost allowance extended again
Another two-year extension of the temporary accelerated capital cost allowance for new investment in machinery and equipment will total $1.4 billion for Canada’s manufacturers and processors from 2014 to 2018. The Canadian Manufacturers and Exporters (CME) is a huge proponent of the policy and claims this particular budget item is worth nearly $4.5 billion over its four year term.
The Federal Economic Development Agency for Southern Ontario (FedDev Ontario) gets a five-year, $920-million renewal starting April 1, 2014. The budget earmarks $200 million from that money for a new Advanced Manufacturing Fund in Ontario, also stretching five years and starting on April 1, 2014.
The Strategic Aerospace and Defence Initiative will get close to $1 billion over five years. Of that money, $110 million over four years, beginning in 2014, will fund an Aerospace Technology Demonstration Program. The program will get $55 million annually thereafter. Debbie Holton, director of events and industry strategy at the Society of Manufacturing Engineers, thinks the Aerospace initiatives will deliver value. “A lot of companies in Canada are very seminal in the development of new technology for aerospace—composites, advanced automation. This [budget] will be a nice financial support so the industry can move forward with technologies for weight reduction, energy savings, improved quality, efficiencies…and affordability too for programs.” says Holton
Forestry innovation and market development will get $92 million over two years, starting in 2014.
Small business offered hiring incentives
The temporary Hiring Credit for Small Business will be extended for one year and expanded at a cost of $225 million.
The Lifetime Capital Gains Exemption will increase to $800,000 and is indexed to inflation. This $110 million, five year commitment is aimed at supporting small business owners, farmers and fishermen.
The 2013 Budget commits to continued red tape reduction and small business service reductions, as well as reviewing and updating the Code of Conduct for the Credit and Debit Card Industry in Canada.
The 15 per cent Mineral Exploration Tax Credit for flow-through share investors in junior mineral exploration will be extended for an additional year at a net cost of $100 million.
The aquaculture sector—which cultivates aquatic plants and animals for food—will see $57.5 million over five years for “enhanced regulatory certainty.” This is described in the budget as the aim to “streamline the aquaculture regulatory regime, to conduct scientific research in support of regulatory decision making, and to report on the environmental and economic performance of the sector.”
The Atlantic and Pacific Integrated Commercial Fisheries Initiative will be extended at a cost of $33.1 million in 2013-14.
Farmers get a piece too, with a five year, $3-billion agricultural policy framework to continue what federal, provincial and territorial governments agreed to in September 2012’s Growing Forward 2 agenda. The money will cover strategic initiatives for innovation, competitiveness and market development, essentially to compete with the Wheat Board. Governments will also continue to deliver Business Risk Management programs and provide assistance to farmers in cases of severe market volatility and disasters.
Research and commercialization
$121 million over two years will go to the National Research Council to help the growth of innovative businesses in Canada.
Small and medium-sized enterprises will get help accessing research and business development services at universities, colleges and other non-profit research institutions with a $20-million, three year program.
Sustainable Development Technology Canada will get $325 million over eight years to continue supporting the development and demonstration of new, clean technologies.
The Canada Revenue Agency (out of all the federal departments, the tax man needs dough?) will receive $20 million over two years to enhance enforcement of the Scientific Research and Experimental Development tax incentive program.
Source: 2013 Federal Budget
With files from Lisa Wichmann