Ontario Manufacturers May Be Granted Tax Credits in 2023
On March 22, the Ontario government announced a new tax credit designed to enable manufacturer growth for Ontario businesses. Doug Ford claims the Ontario Made Manufacturing Investment tax credit will “grow, innovate, become more competitive and create jobs.” This will allow Ontario manufacturers to receive up to $2 million annually from the government. The announcement was unveiled a day prior to the Progressive Conservatives 2023 budget release.
It is estimated that the 2023 legislation will cost the Ontario government $780 million over three years. It would create a ten percent refundable corporate income tax credit that will be regulated for Canadian-controlled private manufacturers with a permanent warehouse in Ontario. “This new credit will go a long way to broadening our industrial strategy — providing predictable funding for essential equipment purchases and increased productivity to enable business growth,” Dennis Darby, CEO and president of Canadian Manufacturers & Exporters said. The tax credit would be available for qualifying manufacturers of up to $20 million a year.
“Our government is continuing to bring back the province’s manufacturing sector by attracting key investments and creating and protecting jobs in communities across the province,” said Peter Bethlenfalvy, Minister of Finance. “The new Ontario Made Manufacturing Investment Tax Credit is just one part of our plan to build a strong economy for the future, today.”
Ontario’s Open for Business Plan
Last year, the province of Ontario secured more than 150 investment deals from various industries including manufacturing, technology, and automotive. Manufacturing alone is one of the province’s key contributors to economic prosperity. Tax credits like the Ontario-Made Manufacturing Investment Tax Credit are a key component of Ontario’s Plan to Build which allows a competitive edge and encourages businesses to expand operations. The province’s manufacturing sector generates $270 billion in annual sales and accounts for approximately 18% of Ontario’s GDP. Ontario’s Open for Business plan is designed to streamline government-to-business services and make the province more desirable for prospective businesses. The Open for Business areas of focus include:
- Progressive Government: developing a streamlined regulatory solution to deliver effective business results while protecting the public interest.
- Modern Services: Delivering optimal products and service standards to support business requirements.
- New relationship with business: Creating a responsive, continuous relationship between these businesses and the Ontario government.
The Ontario government will provide further details on its plan to advance productivity and competitiveness this year in the 2023 Budget which will be released on March 23.