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March 20, 2019

Federal Budget 2019: Highlights

On Tuesday afternoon, the Minister of Finance, Bill Morneau, tabled his fourth and last budget before the federal election.




Here are the main highlights that apply to businesses.


Measures to encourage the adoption of zero-emission vehicles


  1. To attract and support new investments in zero-emission vehicle manufacturing in Canada, automotive manufacturers and parts suppliers can make use of the Strategic Innovation Fund, which recently received an additional $800 million in funding.
  2. To further support businesses’ adoption of zero-emission vehicles, the government proposes that these vehicles be eligible for a full tax write-off in the year they are put in use.
  3. To encourage this transition, a temporary enhanced deduction for capital cost allowance (Accelerated Investment Incentive) of 100% for certain zero-emission vehicles is provided./li>


Scientific Research and Experimental Development (SR&ED) program


The SR&ED program provides a refundable tax credit of 35% for eligible small and medium-sized businesses and 15% for all businesses that carry out SR&ED in Canada. Access to the 35% rate is determined by a business’s level of income and capital.


To better support growing innovative businesses as they are scaling up, the government proposes to eliminate the income threshold for accessing the enhanced credit. Consequently, a Canadian-controlled private corporation (CCPC) whose taxable capital does not exceed $10 million will be eligible for unreduced access to the enhanced refundable credit for SR&ED, regardless of its taxable income.


Canadian film or video production tax credit


Canadian-Belgian co-productions are now eligible for a 25% refundable credit, under a new memorandum of understanding signed by the two countries.


Global Skills Strategy


To follow up on the pilot of the Global Skills Strategy – Global Talent Stream component, the federal government proposes to make it a permanent program. This initiative will give Canadian businesses faster access to top global talent when Canadian workers are unavailable.


Canadian journalism


  1. Journalism organizations will be able to register as qualified donees as of January 1, 2020.
  2. A new refundable labour tax credit for qualified journalism organizations has been created and will apply to salary or wages earned since January 1, 2019.


This summary presents the major points of the 2019 federal budget that apply to businesses. All the measures presented can be consulted on the Finances Canada Open a new windowwebsite.