Canadian Legislative News

In late-March, the Minister of Finance Bill Morneau tabled the last budget of the Liberal’s mandate in the House of Commons. The budget sets the tone for the government’s re-election effort ahead of a busy unofficial campaign season and the writ drop expected late this summer.

The budget revealed developments in terms of its zero-emission vehicle (ZEV) plan. In February, the Government of Canada announced its goal for ZEVs to account for 100 percent of new cars sold in 2040. These targets were communicated without consensus with the provinces and consultation with industry stakeholders. The government did not provide any details on how Ottawa intends to achieve these targets.

The 2019 budget brought a number of measures to help achieve these targets and incentivize ZEV adoption by Canadians across the nation, introducing a new federal purchasing incentive of $5,000 towards ZEV and hydrogen-fuel vehicles with a maximum price tag of $45,000 (MSRP).

The incentive program proposes to increase demand for ZEVs and make them more affordable. Supporting business efforts in the electrification of their fleets, the budget changes the rules for deductions when purchasing an EV, fuel cell, or PHEV with a capacity over 15 kilowatt hours. Under the new rules, businesses are eligible to fully write off the capital cost of ZEVs up to a limit of $55,000 in the first year of investment, effective immediately and over the next five years.

Other measures to support the adoption of ZEVs include $130 million over five years to deploy new charging and hydrogen refueling stations and funding to Transport Canada to work with auto manufacturers to secure voluntary zero-emission vehicle sales targets to ensure that vehicle supply meets increased demand.

Changes will also be made to the road safety transfer payment program that is intended to align interprovincial vehicle business travel. That includes aligning requirements for connected and autonomous vehicles. Funding would be made available to stakeholders, such as academia and industry associations, to identify innovative road safety options and emerging technologies.