The Ontario government will be expanding its current manufacturing tax credit program in the upcoming budget on May 15.
An additional $1.3 billion over three years will injected into the Ontario Made Manufacturing Investment Tax Credit for businesses to invest in buildings, machinery and equipment used in manufacturing and processing in Ontario.
The changes would take the tax credit for Canadian-controlled private companies from 10 per cent to 15 per cent and expands eligibility to non-Canadian-controlled private corporations as a non-refundable tax credits to support their investments in Ontario. A qualifying corporation could receive a tax credit of up to $3 million a year.
In a release, Finance minister Peter Bethlenfalvy framed it as protecting manufacturing jobs in the wake of the economic uncertainty from U.S. tariffs.
“In response, our plan to protect Ontario will bring in new investments to create new jobs and opportunities for our world-class manufacturing workers, so we can build a stronger economy capable of withstanding whatever comes our way.”
Economic Development, Job Creation and Trade Minister Vic Fedeli said the province is “doubling down” on its plan to protect more than 830,000 Ontarians who work in the manufacturing sector and encourage new investments.
The tax credit was first introduced in the 2023 provincial budget to help manufacturers lower costs, innovate and become more competitive.
“The global investment climate is experiencing an unprecedented shift in dynamics,” said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, in a statement. “The increased eligibility for this manufacturing tax credit announced today helps position Ontario jobs and investments on a stronger footing against new headwinds relative to competing jurisdictions in the game.”
