Canada’s 2024 budget includes tax credit for building EV factories

Canada’s federal budget released on Tuesday includes a tax break hoping to entice automakers to build electric vehicle (EV) factories in the country.

According to Bloomberg, the incentive offers a 10 percent tax credit on the capital cost of buildings used for EV manufacturing.

Bloomberg notes the new incentive is a shift for the Canadian government, which is trying to keep pace with the U.S. Last year, Canada also gave huge production-subsidy packages to Volkswagen, Stellantis and Northvolt to build battery assembly plants.

However, it seems the government is done with those packages and hopes the tax credits will be a sufficient incentive.

Honda, for example, is looking at a multi-billion dollar EV project, but the feds haven’t offered a production subsidy deal, unnamed sources told Bloomberg.

Along with the EV tax incentive, the budget includes other programs intended to boost investment in energy and natural resources projects.