NDP touts new capital tax credit

The NDP government — which is plowing money into roads and schools — is also hoping to spur private-sector construction.

Economic Development and Trade Minister Deron Bilous announced more detail around a new $75-million capital investment tax credit for businesses.

Expected to begin in 2017 and run for two years, the credit is designed to encourage businesses to invest in capital by returning a percentage of the company’s costs, including the purchase of machinery, equipment and buildings.

It will be implemented as a 10-per-cent non-refundable tax credit worth up to $5 million.

“The aim of this tax credit is to encourage large-scale capital investment projects that will support new jobs by fostering increased economic activity,” said Bilous in a news conference at Calgary business Glenmore Fabricators.

The provincial budget released last week suggested the tax credit would be for businesses in the value-added agriculture, manufacturing, processing, tourism and cultural industries that are acquiring new and used properties.

But Bilous said the program could be expanded beyond those sectors depending on feedback before it is implemented.

The tax credit is part of a suite of measures aimed at bolstering the Alberta economy, which is in its second year of recession due to oil prices that have plunged since 2014.

Jason Gillen, general manager of Glenmore Fabricators, hoped the tax credit would help get companies building.

He said in the “sketchy” economic environment, his steel fabrication business had reduced operations in its shop to four days a week.

“I think anything we can put out there in the market right now will help,” said Gillen.