[ Image courtesy of the Toronto Star ]
During the Leaders’ english debate on October the 3rd, one issue that was broached was the federal SRED (Scientific Research and Experimental Development) business incentive program. Under the existing federal SR&ED program, non-profitable corporations with large revenues may receive research and development tax credits that cannot be applied. Liberal leader Stephane Dion and Bloc Québécois leader Gilles Duceppe both proposed that these tax credits be partially refundable.
“A Liberal Government will encourage all companies to innovate, even if their innovation does not lead to immediate profitability, by making the SR&ED Tax Credit partially refundable. This change is vital at a time when many companies are struggling to become or stay profitable. Every company that puts money into R&D should be rewarded for innovating.” [ Source ]
Large corporations can sometimes receive millions of dollars in tax credits through the SR&ED program. I think that this measure, if implemented, will increase the cashflows of these large corporations drastically!