“This is a significant subsidy,” Mr. Giroux told reporters, noting it is six times the annual budget of the federal Environment and Climate Change Department.
“Yes,” she replied, adding that the goal of Canada’s policy will be to align with the IRA incentives that are now in place in the United States.credits and we have successfully levelled the playing field. As you see with these investments being made in Canada, the IRA tax credits are not taxable. And so for us, the clearest, simplest route, we have decided, is simply to take the same approach in Canada,” she said.
Reached for comment on the minister’s remarks, Mr. Giroux said his office had confirmed with federal public servants that the production support would be taxable. He said the PBO also reviewed the government’s contract with Volkswagen. If the government were to change tax laws to waive that tax obligation, he said the PBO’s estimate would come down and would be roughly in line with the government’s.
Earlier in the day, Mr. Giroux told reporters that the PBO report only looks at the economic and fiscal benefits of the construction stage of the plant, not its operation, because much of the government’s information is confidential, including the plant’s annual output and subsidies. “That limits us in our capacity to estimate the economic impacts,” he said.