Budget makes changes to LSIF legislation

Tight capital markets for small companies has prompted changes to the Community Small Business Investment Funds Act. The Budget proposes expanding the scope of firms eligible for investments by Labour Sponsored Investment Funds (LSIF) to include larger firms and an increased ceiling on investment amounts. LSIF investments can now be made in firms with a maximum asset size of $60 million, up from $50 million. The maximum size of the investment will increase $3 million to $18 million.

Changes are also proposed for the Community Small Business Investment Funds (CSBIF) program, including a doubling of the investment incentive for LSIFs from 15% to 30%. Half would be available at the time of investment in a CSBIF, and half when the CSBIF invests in a small business.

The Ontario Business Research Institute Tax Credit is also subject to changes, The provision that there be no connection between the business and research institute for two years has been eliminated.