OTTAWA,
ON, June 21, 2024 /CNW/ - As countries around
the world race to seize the economic opportunities associated with
a net-zero future, the Government of Canada is taking bold action to ensure
Canadian workers and industry succeed. The Clean Economy Investment
Tax Credits (ITCs), representing $93
billion in federal incentives by 2034–35, will play an
essential role in attracting investment, supporting Canadian
innovation, creating jobs and driving Canada's economy toward net zero by 2050.
Today, the Honourable Jonathan Wilkinson, Minister of Energy and
Natural Resources, and the Honourable Marie-Claude Bibeau, Minister
of National Revenue, announced the passing into law of the first
four Clean Economy Investment Tax Credits: the Clean Technology
ITC, the Carbon Capture, Utilization and Storage (CCUS) ITC, the
Clean Technology Manufacturing ITC, and the Clean Hydrogen ITC.
With the Royal Assent of Bill C-59, the Fall Economic
Statement Implementation Act, 2023, eligible businesses can now
apply for and claim the Clean Technology and CCUS ITCs. The Clean
Technology ITC and CCUS ITC are anticipated to provide eligible
companies approximately $11.4 billion
in support through 2027–28.
With the Royal Assent of Bill C-69, the Budget Implementation
Act, 2024, No. 1, eligible businesses should be able to apply
for tax credits this fall for clean technology manufacturing and
clean hydrogen projects. Further information on applying for the
Clean Technology Manufacturing ITC and Clean Hydrogen ITC will be
provided in the coming months.
The Clean Technology ITC will provide support to
qualifying taxpayers who are investing capital in specified clean
technologies in Canada. The
Canada Revenue Agency (CRA) is responsible for administering the
Clean Technology ITC, including assessing claims and
issuing payments, while Natural Resources Canada (NRCan) is
responsible for providing guidance on what qualifies as a clean
technology property. Examples of eligible clean technologies
include clean electricity generation equipment such as wind
turbines and solar panels, stationary electrical energy storage,
low-carbon heating systems such as ground and air source heat
pumps, and non-road zero-emission vehicles.
The CCUS ITC, administered jointly by NRCan and the CRA,
will provide support to taxable Canadian corporations that incur
eligible expenditures for qualified CCUS projects. The CCUS
ITC is available to a broad range of CCUS applications and
projects across different industrial sectors. For detailed
information, including eligible projects and equipment, NRCan's
technical guide for the CCUS ITC, how to submit a CCUS project plan
to NRCan, and how to claim the ITCs with the CRA, is now available
on the Clean Economy Investment Tax Credits webpages.
The Clean Technology Manufacturing ITC will provide
support to Canadian companies that are manufacturing or processing
clean technologies and their precursors, providing support for 30
percent of the cost of investments in new machinery and equipment
used to manufacture or process key clean technologies, and extract,
process, or recycle key critical minerals.
The Clean Hydrogen ITC will provide a 15 to 40 percent
refundable tax credit for investments in projects that produce
hydrogen, with the projects that produce the cleanest hydrogen
receiving the highest levels of support. Equipment needed to
convert hydrogen into ammonia, in order to transport hydrogen, may
also be eligible.
NRCan and the CRA have worked closely to develop a seamless
service experience for businesses seeking to claim these Clean
Economy ITCs, centralized on the Clean Economy Investment Tax
Credits webpages. As more information becomes available from NRCan
and/or CRA, including about the Clean Technology Manufacturing ITC
and Clean Hydrogen ITC, this webpage will be updated. The federal
government is following through on its commitment to deliver on the
ITCs, which are already spurring investments and helping Canadian
businesses compete and succeed while reducing emissions and will
bring forward the full suite of ITCs to Canadians in the near
term.
Quotes
"Clean technology innovation and projects will be a key driver
of how we decarbonize, create jobs and bring investment to
Canada as we build a prosperous
net-zero economy in 2050. Canada's
Investment Tax Credits will reduce emissions and create hundreds of
sustainable jobs for Canadians, exemplifying how climate action and
economic growth go hand in hand. We are bringing benefits for
Canadians today and into the future, and ensuring Canada is a global economic leader of the
future."
The Honourable Jonathan Wilkinson
Minister of
Energy and Natural Resources
"Our government is committed to empowering Canadian businesses
to excel as global leaders in the pivotal industries that will grow
our clean economy. Providing business tax incentives that
contribute to Canada's economic
well-being is at the core of the Canada Revenue Agency's mandate.
We will continue to champion Canada's clean economy, and the visionary
businesses investing in it, through our ongoing engagement with
industries, stakeholders and the tax professional community."
The Honourable Marie-Claude Bibeau
Minister of
National Revenue
Quick Facts
- As referenced in Budget 2024, the federal government is
delivering, on a priority basis, a suite of major economic
investment tax credits, representing $93
billion in incentives by 2034–35, to create jobs and keep
Canada on track to reduce
pollution and reach net zero by 2050.
- Clean Economy Investment Tax Credits include:
- Carbon Capture, Utilization and Storage investment tax
credit;
- Clean Technology investment tax credit;
- Clean Technology Manufacturing investment tax credit;
- Clean Hydrogen investment tax credit;
- Clean Electricity investment tax credit; and
- Electric Vehicle Supply Chain investment tax credit.
- The Clean Technology ITC and CCUS ITC are now
available for qualifying businesses, with more info to come on the
Clean Technology Manufacturing ITC and Clean Hydrogen
ITC. To learn more, including how to claim them, visit Clean
Economy Investment Tax Credits.
- The CRA has established a team that will focus exclusively on
assessing and reviewing the Clean Economy Investment Tax
Credit claims and has set up a dedicated telephone line for
questions related to the Clean Economy investment tax credits.
- NRCan will conduct a detailed evaluation of CCUS project plan
submissions in order to verify qualifying CCUS properties. NRCan
will then provide a project evaluation to the taxpayer that will
support CCUS ITC claims filed with CRA.
- Recipients of the CCUS ITC that have or that expect to
incur eligible expenditures of $250
million or more will be required to produce a construction
and completion knowledge-sharing report and annual operations
knowledge-sharing reports. These reports will be made publicly
available to Canadians.
- Taxpayers may request a technical opinion from NRCan as to
whether equipment in a planned or completed project meets the
engineering and scientific requirements of Clean Technology
property. This is a voluntarily step and any technical opinion
issued by NRCan to the taxpayer is not binding on the CRA in
determining eligibility and entitlements to the Clean Technology
ITC, under section 127.45 of the Income Tax Act.
- The full value of the federal ITCs is only accessible to those
that meet certain labour requirements, including paying workers
prevailing wages and creating apprenticeship opportunities. As
such, the ITCs are helping to spur the creation of good-paying,
sustainable jobs across regions and sectors.
Related Information
- 2030 Emissions Reduction Plan: Clean Air, Strong Economy
- Canada's Sustainable Jobs
Plan
- Canada's Carbon Management
Strategy
- Clean Economy Investment Tax Credits
- Government of Canada released
the 2023 Fall Economic Statement
- CCUS ITC
- Clean Tech ITC
- The Hydrogen Strategy for Canada
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SOURCE Natural Resources Canada