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Critical minerals mining gets tax credits and $1.5 billion infrastructure fund in Canada’s 2023 budget

Canada’s new budget proposes:

  • launch of Critical Minerals Infrastructure Fund, allocating $1.5 billion for energy and transportation projects to unlock priority mineral deposits
  • a refundable tax credit equal to 30% of the cost of investments in new machinery and equipment used to manufacture or process key clean technologies, and extract, process, or recycle key critical minerals (specifically lithium, cobalt, nickel, graphite, copper, and rare earth elements). The credit is expected to cost $4.5 billion over five years, starting in 2023-24, and an additional $6.6 billion from 2028-29 to 2034-35
  • allocation of $1.5 billion from the Strategic Innovation Fund of its existing resources towards projects in sectors including clean technologies, critical minerals, and industrial transformation
  • $10.6 million for Natural Resources Canada’s Centre of Excellence on Critical Minerals to provide direct assistance to critical mineral developers in navigating regulatory processes and government support measures to ensure “the timely completion of these projects is essential—it should not take 12 years to open a critical minerals mine”

The budget builds on last years budget which committed $3.8 billion for Canada’s Critical Minerals Strategy to provide foundational support to Canada’s mining sector.

“The cleantech tax credit is an answer to our call to accelerate development of new critical mineral mines in Canada, and $10 billion over 10 years is no small commitment. We will be focused on how these budget commitments will turn into actions. The new tax credit adds to the nearly $4 billion committed in the 2022 Federal Budget and we are eager to see these funds actually start flowing so that they can have meaningful impact on the ground.”

— Raymond Goldie, President of PDAC

“The Buy North American provisions for critical minerals and electric vehicles in the U.S. Inflation Reduction Act will create opportunities for Canada. In particular, U.S. acceleration of clean technology manufacturing will require robust supply chains of critical minerals that Canada has in abundance. However, to fully unleash Canada’s potential in critical minerals, we need to ensure a framework is in place to accelerate private investment”

— A Made-In-Canada Plan: Affordable Energy, Good Jobs, and a Growing Clean Economy

Our analysis on how Canada is plugging itself into America’s battery belt:

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The Oregon Group

The Oregon Group is an investment research team founded by independent capital markets experts, Anthony Milewski and Justin Cochrane.

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