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The Federal Budget 2022 comes with new opportunities and revolutionary news for Canadian innovators. From new investments to program re-evaluations, each announcement regarding Federal Budget 2022 is a must-know for anyone in the innovation sector. To enable you to focus on your business, we’ve summarized the key points to allow you to continue to thrive and innovate without limits.
Here’s what Canadian Innovators need to know about the Federal Budget 2022:
For years, SR&ED has been the Federal Government’s main support system for the R&D community. Nevertheless, the SR&ED program has carried strict criteria, limiting many innovators from taking advantage of this incentive. However, with the Federal Budget 2022, this is all about to change! With the new budget, the SR&ED program will undergo a revision intended to expand the eligibility criteria, allowing a wider scope of innovators to apply. Additionally, Federal budget 2022 plans to analyze and simplify SR&ED processes to facilitate the innovation process.
With rising concerns of climate change, the Federal Budget 2022 proposes new tax credit programs to incentivize carbon emitters and accelerate the adoption and development of green tech. An $8.6 Billion investment in the Carbon Capture, Utilization, and Storage Program (CCUS) deploying until 2030 may entitle your business up to 60% in refunds for adopting CCUS technology. Other credits and/or refunds may also be available for businesses adopting low and zero-emission technologies. Additionally, to work towards reducing Canada’s carbon footprint and becoming leaders in green tech, this budget may also finance mineral-exploration activities within Canada and incentivize Canadian innovators to capture intellectual property in green tech.
Federal Budget 2022 will continue to finance numerous pre-existing government grants for innovators in multiple sectors into the future year. In this Federal Budget, special financing was granted towards innovators taking action to build a sustainable future with over $2 Billion distributed throughout several new grant programs dedicated to raw material exploration in Canada. Innovators within the Life Science sector may also be able to take advantage of an additional $1 Billion with the SIF and SIF Net Zero Program. Other sectors that will receive additional funding with the Federal Budget 2022 include: AI, regional programs, and the superclusters to name a few.
As seen above, the Federal Budget emphasizes the development and implementation of sustainable innovations. With Canada’s climate goals in place, the Federal Government appears to be actively working towards these goals by not only incentivizing green initiatives, but also by seeking to augment the existing $15 Billion in funding to $60 Billion by partnering with external parties such as the Innovation & Investment Agency.
Overall, Federal Budget 2022 is encouraging a competitive landscape in the green innovation sector, leaving the remainder of the ecosystem unchanged. Regardless of the sector, government incentives can provide innovators with extensive financial relief and will likely remain competitive in nature. Working with a knowledgeable consultant can ensure that your business successfully obtains financial support and maximizes its cash flow.
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