Chapter 1 · 1.1 Making Canada the best place to invest
Kickstarting Canada's Investment Supercycle with the Productivity Mega Deduction
$36.1B net impact on the budgetary balance over five years, 2026-27 to 2030-31.
The cost line
| Line | 2026-27 | 2027-28 | 2028-29 | 2029-30 | 2030-31 | Total |
|---|---|---|---|---|---|---|
| Measure | 2,015 | 8,870 | 8,895 | 7,020 | 9,255 | 36,055 |
… no change to existing funding or no fiscal implication · – a further extension will be considered later · 0* less than $0.5 million. Positive numbers cost the budget (spending or forgone revenue); negative numbers improve it.
What the budget says
“With an estimated fiscal cost of $36 billion over five years, beginning in 2026-27, it will help create the conditions for an extended period of higher investment: Canada's Investment Supercycle.”
Budget 2026, p. 111 (PDF p. 121)
Key facts
- Lets businesses immediately write off the full cost of a broader range of capital assets, on a permanent basis; the budget puts the fiscal cost at $36 billion over five years. Budget 2026, p. 111 (PDF p. 121)
- The budget's own construction examples include jackhammers, excavators, bulldozers, mobile cranes, concrete mixers, graders, backhoes, dump trucks and welding equipment. Budget 2026, p. 113 (PDF p. 123)
- The budget says the marginal effective tax rate on new business investment falls from 13% to 6.4%. Budget 2026, p. 111 (PDF p. 121)
Amounts named in the text
Stated amounts can cover different periods, cash or accrual bases, previously announced money and loans. They are not additive with the cost line above.
- $36 billion over five years, beginning in 2026-27
If you run a shop, a crew or a fleet, read this one first. The equipment list reads like a yard inventory. Buying iron is still a cash-flow decision: model the purchase, the work it will win and the deduction together before you sign.
What to watch: Legislation and CRA guidance on eligible asset classes and in-service dates.
Also in this section
- Backing Canada's next generation of entrepreneurs$715MTax measureBusinessesInvestment
- Helping Canadian innovators scale at home$94MProgram spendingLoans, equity or financingBusinessesInvestment
- Boosting innovation and commercialisation$936MTax measureBusinessesInvestment
- Unleashing billions for Canadian businesses with the Canada Investment Summit$181MProgram spendingBusinessesInvestment
- Mobilising private investment to modernise Canada's airports$42MProgram spendingInvestmentInfrastructure & transportPublic work
- Rewarding innovation by helping Canadian ideas and talent succeedno cost lineNo cost line