Canada Credits & Incentives
There is a common misconception that incentives are not prevalent across the Canadian provinces. While there are certainly varying ways in how incentives are utilized and deployed, provincial and local governments throughout Canada do leverage financial and technical resources to support business growth, industrial development, and job retention. Very often these programs are also backed with federal funding to drive initiatives across the nation.
With a dynamic economy leading in everything from timber to energy, communications, and services, the Canadian business ecosystem is robust. We find incentives to be utilized in a fashion that is tailored to the industries and kills best fit for the respective province and workforce. In addition, businesses also leverage these resources to find success with a multi-cultural, multilingual society, such as French and English language programs for employees in Quebec.
Looking ahead, provincial governments are continuing to refine their incentive programs to ensure the initiatives will meet their needs for the future. Examples of these shifts forward are seen in continued and expanded programs for research and development activities and software development, core not only to today but also the economy of tomorrow.
Businesses can still leverage a sales tax rebate in British Columbia, which was designed to support businesses impacted by Covid-19. Core to the Stronger BC program, eligible businesses can receive a PST refund for investments in select machinery and equipment. Businesses may capture the incentive for the purchase of qualifying items, which includes furniture, software, tools, computers, software, and zero-emission vehicles and respective charging equipment.
To deliver support for provincial advanced manufacturing businesses,the Ontario government launched the Advanced Manufacturing and Innovation Competitiveness (AMIC) program. The program will invest CAD$40 million over the next two years to assist with equipment purchasing, advanced technologies, and work force training needs. To be eligible for the program, businesses must have a minimum of ten employees, at least three years of financial statements,and capital investment levels at a minimum of $500,000 in eligible project costs. The first round of applications opened up on February 10, 2022.
To help support a growing population in Nova Scotia, provincial leaders are looking for creative ways to recruit healthcare and skilled trade workers. With a strategic, multi-faceted plan, Nova Scotia officials are targeting those individuals needed most for today, as well as, into the future. First, the strategy will invest in television, radio, and digital marketing channels to get the word out about career opportunities in the province. Secondly, the province will return income taxes taken on the first $50,000 in salary for eligible individuals aged 30 and under.
In recent years, the Province of Quebec has made significant investments in economic development and investment promotion activities. In an announcement last year, Minister of Finance Eric Girard outlined their spending initiatives for 2022, including CAD $2.9 billion in workforce training and economic development measures. Of those, CAD $1.7 billion will go towards a new incentive scholarship program for students enrolled in degree programs associated with targeted occupations. Another CAD $444 million will be directed towards business investment,including the implementation of innovation zones in Quebec.
Mexico Credits & Incentives
The economy of Mexico is vast and growing, with a dynamic landscape across a range of industries and an ever-increasing role in the global supply chain. With ProMexico no longer a central entity for foreign director investors to turn to,economic development is driven at the state and local levels.
When it comes to incentives, state and local governments work within their discretion to develop and deploy programs leveraging limited resources to target business and real estate investors. Often, we see state programs with core programmatic initiatives, while at the local level, incentives are delivered on a more discretionary, case-by-case basis.
Looking ahead at 2022, with expanded interest in Mexico,particularly to service the wide-ranging North American marketplace, incentives will become a key driver in location decisions. Alongside logistics, workforce, security, and operational costs, incentives are increasingly part of the ultimate site selection process as businesses evaluate multiple potential markets.
To ensure the state of Baja California is known for its vibrant culture and robust talent, economic development and tourism promotion officials kicked off a new rebranding campaign last year. Officially returning to their base mission of highlighting the state’s business and hospitality opportunities,including a new website, logo, and digital marketing campaigns. Baja California, which is home to major business hubs like Mexicali, Tijuana,and Tecate, among others, has dubbed one of their campaigns, The Road Awaits.
As many American states and Canadian provinces provide incentives for film and television productions, there are many Mexican states and communities also looking to invest in the growing, dynamic industry. There are incentives available, particularly tied to Value Added Tax (VAT) tied to production, from the federal levels. The State of Jalisco has long talked about expanding their support mechanisms for productions within their jurisdictions, in essence, to develop what they call – Jallywood. One program opportunity is run through the Jalisco Film Commission Trust (COFIEJ), which provides support grants for the production of animation, documentary, and fiction films in the state.
The state of Nuevo Leon and the Monterrey region are working to be recognized as a global hub for the dynamic electric and autonomous vehicle industries. As a fast-growing industry sector, the region has been proactive in attracting and recruiting companies across the vertical supply chain, particularly tied to large North American investment strategies. To help support the industry, the state will be rolling out several initiatives and investment promotion policies,including economic development incentives.
When we identify the most successful communities for business and development around the world, we commonly look to the strengths of the local private-public partnerships. The Covid-19 response that was undertaken in Mexico City is a great standard of the partnership model. Led by foundations established by a private sector consortium, nearly $80 million was invested in turning the Citibanamex conference center into a full-turn field hospital and medical hub treating coronavirus patients. The success of these partnerships is among those key drivers business leaders are seeking when navigating their global portfolios.