Québec Finance Minister Eric Girard released the 2023-2024 budget, making clear that the provincial government is betting on economic growth. The plan earmarks $900 million towards new initiatives intended to stimulate economic productivity and innovation, and $615 million to address the labour shortage.
Certain tech sectors in particular are being targeted by the government. The budget promises investments in cleantech, AI, FinTech, and two “innovation zones” focused on quantum sciences and digital technologies.
“We were disappointed that the government did not take steps to ensure that tax credits for digital media and video game production were not more carefully scoped.”
While the budget was generally well received by the Council of Canadian Innovators (CCI), director of policy and research Laurent Carbonnneau critiqued that the tax credit program for digital media and video game companies has largely remained the same.
“We were disappointed that the government did not take steps to ensure that tax credits for digital media and video game production were not more carefully scoped to benefit domestic Quebec companies first and foremost,” he said.
Carbonneau cited a study (in French) by the University of Sherbrooke, which demonstrates that multinationals, rather than Québec-based companies, are aided by these tax credits.
In terms of specific tech investments, the Québec budget sets aside $30 million over three years for cleantech businesses, citing climate change as a factor that created a priority shift.
Artificial intelligence is one of the emerging technologies Québec wants to support with $5 million over two years, under the purview of the Ministère de la Cybersécurité et du Numérique (ministry of cybersecurity and digital technology).
Finance Montreal’s FinTech Station, which provides FinTech startups with leasing space and networking opportunities, will see a $15.4 million investment over the course of seven years. This will allow the organization to expand its office space availability, making it possible to accommodate 15 to 20 more fintech companies.
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Like most provinces, Québec is facing a labour shortage, which the government wants to address. One of its strategies includes $13.2 million over three years to support Montreal International, Québec International, and the Société de développement économique de Drummondville (business improvement area of Drummondville) in their international recruitment efforts.
Montreal International, in particular, hosts Journées Tech Québec, where companies get to meet candidates with various tech and IT skills.
Québec also plans to invest $66.8 million over the next three years towards attracting international talent.
Over the next five years, Québec will inject two “innovation zones” with $100 million. One of these is DistriQ, in Sherbrooke, which focuses on quantum sciences and technology. The other is Technum Québec, located in Bromont, which specializes in digital technologies.
In addition, the government has introduced a “tax holiday” for large investment projects. This means that when a company invests in a project of $100 million or more, it will get a tax break on revenue and its contributions to its health services fund. Information and cultural industries are among the eight major sectors expected to benefit from this initiative.