Bill C-269 — Loi modifiant la Loi de l’impôt sur le revenu (crédit d’impôt pour la récupération de la chaleur)
This proposed law would create a new tax break called the "heat recovery tax credit." It would allow certain companies to lower their taxes. They can do this if they buy special equipment that captures and reuses heat from industrial processes. This equipment must be new and used in Canada. The tax break would be equal to 30% of the cost of the equipment. This proposed law would only affect taxable Canadian corporations. These are companies that pay income tax in Canada. It matters because it could encourage businesses to invest in technology that reduces energy waste. This could help the environment and make businesses more efficient. However, there are some limitations. The company can't have received other government money for the same equipment. Also, if the company later sells or stops using the equipment for heat recovery, they have to pay back the tax break. This proposed law would start in 2025.
Where this proposed law falls on the policy spectrums that Canadians care about
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Inscription gratuite — 30 sThis proposed law introduces a tax credit for companies that invest in equipment to recover heat from industrial processes. This could encourage businesses to be more energy-efficient, but the rules around partnerships and assistance could be confusing.
Things to Watch For
- The definition of 'qualifying heat recovery equipment' is very specific; make sure your equipment fits the rules.
- The tax credit only applies to corporations, leaving out other types of businesses.
- Watch out for the rule that claws back the tax credit if the equipment is sold or used for something else within five years.
- The rules about partnerships and how they share the tax credit could be complex.
- It's not clear how the government will decide if a partnership's sharing of the tax credit is 'reasonable'.
- The law doesn't say how the government will check if the equipment is really being used for heat recovery.
- The start date is after 2025, so investments made before then don't count.
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How likely this proposed law is to be approved
This is a private member's proposed law that is low on the list to be considered. These proposed laws rarely pass unless the government adopts them, which is unlikely at this stage.
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