Similar to the US, startups and high-growth companies use stock options to offset expensive salaries in order to attract and retain high-caliber employees. At McRock, we are breathing a huge sigh of relief as a change to the stock option tax treatment would have instantly made Canadian tech companies unable to compete on the global stage.
Another piece of good news from the 2016 budget, was the reinstatement of the 15% federal tax credit for Labour-Sponsored Venture Capital Corporations (LSVCC). This is a u-turn in the previous government's plan to wind down the federal LSVCC tax credit. In provinces like Quebec, which still have an active Federal and Provincial LSVCC tax credit program, this ensures a return of investment capital to the innovation ecosystem. Congratulations to our LSVCC friends. This is a long time coming and a big win for the Canadian innovation eco-system.