The provincial government is proposing changes to a tax credit program that supports small businesses.
The Small Business Investor Tax Credit program provides people with a non-refundable income tax credit to encourage investment in eligible businesses and community economic development corporations.
According to the government, the proposed changes will promote innovation and encourage economic growth.
“We are committed to creating a stronger and more prosperous New Brunswick by empowering entrepreneurs and investors to drive productivity and innovation,” said Finance Minister René Legacy.
“Through the promotion of strategic, targeted investments, we are recognizing the importance that strategic sectors play in the province’s economy and export potential.”
The Department of Finance and Treasury Board along with Opportunities NB reviewed the program with input from stakeholders.
Findings indicated the program was effective, but also pointed out opportunities to increase its impact with targeted improvements.
“We’ve been clear that improving access to capital is a key part of helping New Brunswick businesses grow,” Opportunities NB Minister Luke Randall said in a release.
“These updates to the Small Business Investor Tax Credit make one of the strongest programs of its kind in the country even better.”
Proposed changes to the New Brunswick Income Tax Act and Small Business Investor Tax Credit Act include:
- Increasing the tax credit rate for corporate investors to 25 per cent from 15 per cent, better rewarding impactful investments
- Raising the maximum threshold of eligible corporations’ net tangible assets to $50 million from $40 million, increasing access to the program
- Introducing convertible debentures as a new eligible funding vehicle for greater flexibility for businesses and investors
Individual investors would continue to get a 50 per cent credit, the highest rate in Canada.
A new two-tiered tax credit structure would be introduced to promote investment in defined strategic sectors.
Individual and corporate investors in those sectors have higher investment limits of $1 million.
Strategic sectors will be set out in regulations and were chosen based on export potential and importance to the province’s economy.
They include agriculture, forestry, aquaculture, manufacturing, architecture and engineering, digital media, performing arts and information technology.
In the case of non-strategic sectors, maximum investment limits of $250,000 for individual investors and $500,000 for corporate investments would remain the same.
A combined maximum eligible investment limit of $1 million would apply to all investments.
All the updated parameters, including the two-tiered tax credit structure, would apply retroactively to any investments made on or after March 17, 2026.
The proposed amendments were welcomed by the New Brunswick Business Council.
“In a period of significant economic uncertainty, any measure that increases investable thresholds and de-risks capital deployment into New Brunswick businesses is a step in the right direction,” said NBBC president and CEO Monica Gaudet-Justason.
Gaudet-Justason said access to capital is key to productivity growth, business scaling and export capacity.
“The Small Business Investor Tax Credit is one of the province’s most direct levers for improving that access.”
