Some core business incentives in last week’s lame-duck federal budget are likely to return if the Conservatives manage to win another mandate.
Fred O’Riordan, national tax adviser for Ernst & Young LLP, told Business in Vancouver, “Of all the measures in the budget, you can bank on the accelerated capital depreciation and the mineral exploration tax credit being reinserted. I’d be very surprised if there was any movement away from those commitments.”
O’Riordan suggested any new budget is not likely until September, at which time the government would reassess the state of the economy and how it was tracking to its forecasts. A fall budget would not preclude the possibility of the corporate tax incentives to be retroactive for the year.
“They were proposing to extend [the mineral tax credit and the accelerated capital depreciation], so they could still propose to extend them within the same tax year,” he said.
Last week’s budget did not get a chance to be voted on by MPs as it was preceded by a vote on the motion that declared the government in contempt of Parliament. Early Friday afternoon, 156 opposition MPs from the Liberals, NDP and Bloc Quebecois voted to support the non-confidence motion, outnumbering the 145 Conservatives that voted against.
Before Friday’s vote, the election prediction project already forecast the Conservatives would win the most seats, although 75 across Canada were too close to call.
Read more about the government’s economic and fiscal forecasts in this week’s issue of Business in Vancouver.