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March 28, 2017

Highlights of the Budget Speech 2017–2018

Economic Development Fund

 

$125 million to promote the development of the innovative manufacturing industry

 

This $125-million envelope complements the appropriations announced by the Minister of Economy, Science and Innovation in April 2016 to support innovative manufacturing companies throughout Québec.

 

To this end, the Ministère de l’Économie, de la Science et de l’Innovation will receive additional appropriations in the amount of $48.5 million over the course of the next five years.

 

Tax measures

 

2.1 Three-year extension of the tax holiday for large investment projects

 

Companies carrying out eligible projects may file their application by December 31, 2020, at the latest.

 

 

Streamlining of the refundable tax credit for corporations specialized in the production of multimedia titles (TMVS)

 

Prior to March 28, at least 75% of the activities related to eligible titles had to be carried on in Québec to produce titles for the corporation itself or on behalf of another person. As of that date, any component of an eligible title produced by a subcontractor is eligible for purposes of the 75% criterion and the premium for French. This rule applies to applications for certificates made after March 28, 2017.

 

Other measures affecting business

 

$100 million to create an artificial intelligence super-cluster

 

There is currently a boom in activities involving the development of artificial intelligence technologies. Major technology companies are investing considerable funds to develop applications used in various industries, including health, energy, transportation, business and finance.

 

To support growth in AI industry, the Québec Economic Plan provides for an investment of $100 million for the creation of an artificial intelligence super-cluster.

 

The following five areas will be prioritized as part of the work performed by the super-cluster:

 

  • attracting and retaining talent in a context where demand for capabilities in deep learning is strong;
  • maintaining a critical mass of high-calibre researchers in artificial intelligence in Québec to incite young researchers to establish their career here and to attract the interest of industry leaders;
  • creating a business environment that fosters the development and marketing of scientific advances in products and solutions;
  • helping businesses get started and gain access to venture capital in the field of artificial intelligence in Québec, as well as getting graduate students in artificial intelligence interested in business start-ups in this field;
  • increasing the acceptability and social impact of artificial intelligence to ensure that the issues it raises, particularly with regard to confidentiality, are discussed with both experts and citizens.

 

 

Additional deduction for capital cost allowance to support business modernization and productivity

 

An additional 35% deduction in capital cost allowance, when a business acquires manufacturing and processing equipment or computer equipment before April 1, 2019, was introduced.

 

A business will be entitled to the allowance for two taxation years: the taxation year in which the property is first put to use and the following taxation year. Applicable to new equipment acquired after March 28, 2017, and before April 1, 2019.

 

 

Higher increases respecting the refundable tax credit for Québec film or television production

 

Certain types of labour expenditures may give entitlement to two specific increases:

 

  • increase from 8% to 10% in the rate of enhancement for computer-aided special effects and animation;
  • increase from 8% to 10% and 16% to 20% in the regional improvement rates, depending on the type of production.

 

These changes will apply to a production for which an application for an advance ruling, or an application for a certificate in certain cases, is submitted to SODEC after March 28, 2017.

 

Other measures affecting certain industries

 

  • $118 million for the life sciences strategy.
  • $46 million to stimulate innovation in the forestry industry, particularly to support bodies involved in innovation (including $4 million for FPInnovations for its collaborative research program).
  • $4.4 million over the next five years to support the operation of a new industrial cluster of electric and intelligent vehicles and fund priority projects.
  • $70 million over two years to finance measures to facilitate the acquisition and use of electric vehicles.
  • $45 million for new initiatives as part of the Plan Nord.
  • $100 million over five years for activities involving representation, prospecting and cooperation around the world through Québec’s international action, to attract foreign investment and talented immigrants in connection with Québec’s major socioeconomic development jobsites including the Plan Nord, the Maritime Strategy and transport electrification.
  • the government will unveil a sustainable mobility policy next year that covers all means of transportation, namely public transit and active transportation, as well as air, rail and sea transportation, to complement the road system.
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Contact your expert

Marie-Ève Savard

Government Relations and Public Affairs Advisor, Montréal

514 876-9412

Contact your expert

Marie-Ève Savard

Government Relations and Public Affairs Advisor, Montréal

514 876-9412