The Intellectual Property Institute of Canada (“IPIC”), Canada’s professional association representing intellectual property practitioners across the country, has formally submitted recommendations for “fostering a culture of innovation” to Canada’s Minister of Finance. The submission was made in the months leading up to announcement of the federal Liberal government’s second budget under Prime Minister Justin Trudeau’s leadership.
Following a previous announcement made within a Minister of Finance’s mandate letter identifying a priority of ensuring “tax measures are efficient and encourage innovation, trade and the growth of Canadian businesses”, IPIC has formally recommended that the government consider the creation of an “innovation box”. This is a tax incentive that allows business income derived from intellectual property rights to be taxed at a lower rate than regular income.
As previously reported in this space, this type of tax incentive regime has been recently adopted by the Québec provincial government, and is already in place in China and the UK. Similar proposals are also currently under consideration before US congress.
With this recommendation, IPIC hopes that the federal government realizes the plank of its election platform, indicating a willingness to prioritize policies encouraging science, innovation and research.
Given that this fall will be certainly a busy legislative period for a young government looking to transform a summer of goodwill into concrete political gains, the country’s science, technology, educational and entrepreneurial leaders will be closely watching the spring 2017 budget for a clear indication that their elected lawmakers are willing to tangibly support Canada’s innovative companies.
For new developments on this very important issue of Canadian law and business, be sure to watch this space!
And for any questions about your own IP rights for products, feel free to contact our Intellectual Property group.