2024 Ontario Budget: Important Implications for SR&ED
2024 Ontario Budget Overview
The focus of the 2024 Ontario budget is to invest in key public services and not raise taxes or fees in an effort to increase revenues. Highlights of the budget which may impact the SR&ED program for Ontario claimants involve investing extra funding to attract investments and new jobs in manufacturing, life sciences, and technology sectors, as well as extra funding to the Critical Minerals Innovation Fund in an effort to enhance research and development.
From the Government of Ontario’s 2024 Ontario Budget Highlights page:
- Allocating an additional $100Â million to the Invest Ontario Fund, for a total of $600Â million to help Invest Ontario attract investments and new jobs in key sectors, including advanced manufacturing, life sciences and technology.
- Supporting Ontario’s mining sector by investing an additional $15 million over three years in the Critical Minerals Innovation Fund to enhance research and development.1
Implications the Ontario 2024 Budget may have on SR&ED
Invest Ontario
“Allocating an additional $100 million to the Invest Ontario Fund, for a total of $600 million to help Invest Ontario attract investments and new jobs in key sectors, including advanced manufacturing, life sciences and technology.”2
Invest Ontario’s purpose is to drive greater economic growth, support strategic domestic firms and attract business from around the world into the province of Ontario. The service provides businesses with development and planning expertise to help Ontario businesses succeed. One important element of Invest Ontario is assistance offered to locate programs and services which can help businesses get off the ground or grow, this includes the SR&ED program and related Ontario R&D programs (OITC, ORDTC).3
The Ontario government’s additional investment into this program will hopefully result in a greater number of Ontario companies which are aware of, and able to claim, SR&ED investment tax credits. This is not, however, a guaranteed outcome.
Critical Minerals Innovation Fund
Supporting Ontario’s mining sector by investing an additional $15 million over three years in the Critical Minerals Innovation Fund to enhance research and development.4
The Critical Minerals Innovation Fund (CMIF) provides funding to projects that help strengthen Ontario’s critical minerals. The program provides a maximum of 50% of eligible project costs, up to $500,000 per project, for projects that:
- Support the research, development and commercialization of innovative technologies, techniques, processes and solutions for critical minerals;
- Increase critical minerals exploration, mining, development, production and processing;
- Stimulate investment in Ontario’s critical minerals supply chain; and
- Enhance collaboration between industry, academia, start-ups, and research and development firms to encourage innovation in the critical minerals sector.5
The planned investment into the CMIF portends a greater impact on the amount of SR&ED carried out in the province of Ontario, specifically in basic and applied research fields.
Conclusion
The 2024 Ontario budget looks to take care of the people following the financial hardships caused and exacerbated by the COVID-19 pandemic.
The availability of funding from various channels increases the incentives and opportunities available to Ontario companies, which in turn may promote or allow companies to dedicate additional resources towards innovative practices and resulting research and development. While the extra funding noted in the 2024 budget are not guaranteed to result in increased SR&ED across the province, we can hope the additional funding make it easier for companies to get involved.