Aimed at mining, agriculture businesses, new incentive allows complete write off of up to $55,000, until 2028.
Prime Minister Justin Trudeau announced this week that the federal government is introducing a tax break that gives Canadian businesses a 100 per cent, same-year tax write off for eligible off-road and heavy-duty electric vehicles, up to a maximum of $55,000.
Trudeau made the announcement Tuesday Toronto at the Prospectors & Developers Association of Canada conference. A number of mining companies involved in vehicle electrification, including MacLean Engineering, of Barrie, Ont., were on hand.
“As people in this room know, electric vehicles are not just for city streets,” Trudeau said. “They’re for cleaner mining operations, which protects the health of workers and the environment. Our government wants to support this sector in accelerating the use of clean mining trucks here at home.”
The electrification of vehicles used in mining has substantial positive impacts, including reduced maintenance, fuel and ventilation costs, and improved employee health.
Available until 2027
Vehicles will be eligible for a full write off if they are available for use before 2024. Those available in 2024 and 2025 will be eligible for a 75 per cent deduction; that amount will decrease to 55 per cent in 2026 and 2027.
Vehicles not for use before 2028 will not qualify for the incentive.
The write off is not available, however, if the vehicles also benefit from the government’s current rebate program.
The initiative is designed to encourage electrification not only in the mining sector, but in agriculture and transportation industries. It is expected to cost an estimated $62 million through 2025.
The program is an expansion of one announced as part of last year’s federal budget, through which businesses can claim 100 per cent of the cost on-road passenger vehicles, up to a limit of $55,000 per purchase.
“Our government believes in the power of clean technology to create jobs and drive innovation,” said Seamus O’Regan, Minister of Natural Resources.
“With today’s announcement, we are proud to continue helping Canadian industry seize the momentum of this clean growth century, so that Canadians can benefit from this fast-growing market now and in the future.”