In its 2025 budget, the federal government announced several initiatives to incentivize institutional investors to back domestic infrastructure and business ventures.
The budget proposed $1 billion on a cash basis over three years, starting in 2026, for the Business Development Bank of Canada to launch a venture and growth capital catalyst initiative, a fund-of-funds that would leverage more private venture capital by incentivizing pension funds and other institutional investor participation. The initiative will also support new and emerging fund managers and important sectors such as the life sciences sector.
Read: Feds seeking to boost domestic investments by Canadian institutional investors: budget
Institutional investors will also be able to access a tax credit for clean electricity investments, which will provide a refund equal to 15 per cent of the capital cost of eligible investments in equipment related to low-emitting electricity generation, electricity storage and the transmission of electricity between provinces and territories.
The budget also proposed exploring potential improvements under the National Airports System governance model, including amendments to ground leases and measures to crowd-in additional private investment, including from institutional investors.
Read: Ottawa to remove 30% investment cap for Canadian pension funds