On May 5th, 2025, Ontario’s Provincial Government announced the expansion of the Ontario Made Manufacturing Investment Tax Credit.
What is the Ontario Made Manufacturing Tax Credit?
The Ontario Made Manufacturing Investment Tax Credit (OMMITC) was introduced as a part of the 2023 Budget to help Ontario manufacturers lower their costs and innovate their businesses to become more competitive. The credit is a 10% refundable corporate income tax credit for eligible corporations on various investments in buildings, machinery and equipment for use within the manufacturing and processing within the provincial industry.
Who is eligible for the credit?
Introduced in the 2023 Budget, the 10% refundable corporation income tax credit applies to qualifying investments of up to $20 million per tax year made by eligible corporations. This was previously up to a maximum of $2 million per year. Now, the Ontario Government is expanding these regulations.
What’s Changing?
As part of the 2025 Budget, the Ontario Government is enhancing and expanding the credit.
- The rate will increase from 10% to 15% for Canadian-controlled private corporations.
- Non-Canadian-controlled corporations will now also be eligible, receiving a 15% non-refundable tax credit.
- The maximum annual benefit will rise to $3 million per year.
These changes apply to investments made between May 15, 2025, and before 2030.
Why is this important?
Minister of Finance, Peter Bethlenfalvy notes that Ontario manufacturing workers are experiencing job losses because of President Trump’s tariffs and that Ontario’s manufacturing sector is a key contributor to the economic success of our province.
Currently, the industry employs 830,000 people and it is expected that through 2027 and 2028 the tax credit will provide an estimated $1.4 Billion in income tax support to Ontario manufacturers and processors. The goal is to lower costs for businesses who invest in buildings, machinery and equipment used for manufacturing and processing in the province. This move specifically aligns with Ontario’s long-term strategy to strengthen supply chains, reduce our reliance on imports, and foster innovation in the manufacturing sector.
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