FREDERICTON (GNB) – The provincial government tabled legislation today to amend the Small Business Investor Tax Credit, allowing for the creation of Community Economic Development Investment Funds in order to facilitate investment in small businesses.

A Community Economic Development Investment Fund is a pool of capital, formed through the sale of shares to investors within a defined community (geographical, economic, cultural or industrial), and created to invest in local businesses.

“Expanding the tax credit program to these funds will give small businesses access to new investment funds, and support local economic development,” said Finance Minister Blaine Higgs. “Communities, geographic or industry-based, will be able to put our resources to work, supporting emerging businesses with capital investments. The tax credit will be an incentive to draw investors.”

The funds will provide greater access to capital for social enterprises and co-operative associations, as recommended by the Economic and Social Inclusion Corporation. This type of investment fund can focus on developing many businesses in a community, such as farmers or food producers, or on a larger specific investment, such as a processing facility for local products.

“Community organizations and co-operative associations have long said they should be able to raise funds for local investment with an incentive for investors,” said Higgs. “The new community investment corporations allow groups of investors to target specific types of businesses for investment, or create a blind pool to encourage economic development within a defined community.”

Investors who purchase shares will benefit from the Small Business Investment Tax Credit, according to the rules of the Small Business Investment Tax Credit Act. Eligible investors buying shares in registered Community Economic Development Investment Corporations and co-operative associations will receive a non-refundable New Brunswick income tax credit.

LINK:

●    Department of Finance

15-04-14