Canadian businesses will be able to more quickly recover the costs of certain investments.
Canadian businesses will be able to more quickly recover the costs of certain investments under new rules announced in Finance's 2018 Fall Economic Update. The Update, which was released on November 21, 2018, announces new rules to temporarily allow businesses to immediately expense, for tax purposes, the cost of certain new investments in qualifying machinery and equipment, as well as specified clean energy equipment, and to accelerate tax depreciation on other capital investments. The rules apply to capital property acquired after November 20, 2018 and available for use before 2028. In addition, Finance says it will extend the 15% Mineral Exploration Tax Credit to 2024 and introduce a new refundable tax credit for qualifying news organizations, among other changes.
Finance's new proposals affecting investments in qualifying machinery and equipment and other capital investments have been issued in response to recent U.S. tax measures that allow U.S. businesses to immediately claim a tax deduction for 100% of certain capital investments. This change was included as part of the U.S. tax reform enacted at the end of 2017.
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