InterVac funding and refundable R&D tax credit highlight Saskatchewan Budget

Saskatchewan used its March 18th Budget to let the rest of Canada know that its books are in the best shape of any province. The Budget contained a whopping $2.6 billion in debt reduction, significant personal tax reductions and a $400-million surplus — just one of two provinces to post a surplus this year and far more than the $48 million registered in Manitoba.

Given the relatively free spending nature of the Saskatchewan Budget, there were few initiatives in support of research or innovation. The most notable for tech-based businesses is a major change to the Sask-atchewan Research and Development Tax Credit. The 15% tax credit — a complement to the federal scientific research and experimental development (SR&ED) tax credit program — is being converted from refundable to fully refundable, adding $6 million to its $12-million annual cost.

The change provides a boost to R&D intensive companies that have not reached a revenue-positive stage. Calls for the federal government to enact a similar conversion for SR&ED have not ben successful to date.The provincial tax credit for labour-sponsored venture capital corporations will also be increased to match those of other provinces.

The Budget's other major initiative for research was a $9.8-million contribution to the $140-million International Vaccine Centre (InterVac) at the Univ of Saskatchewan (U of S), slated to open in 2010.

Part of the Vaccine and Infectious Disease Organization (VIDO), the funding leaves just $11.7 million remaining to completely cover construction costs. The Budget also provided InterVac with $5.9 million for previously committed operational funding.

"This (funding) is very positive for what the province has done for emerging infectious diseases and the challenges Canada will face in the future," says Paul Hodgson, associate director of business development at U of S.

The Budget also committed an unspecified amount of money for innovation in carbon capture and storage. The funding is part of more than $17 million the province is committing to several initiatives under its Go Green program.

R$