The new federal budget features a series of measures aimed at supporting small and medium-sized businesses including a renewed commitment to encouraging the growth of Canada’s digital economy.

As part of the government’s Digital Economy Strategy, the budget allocates $80 million in new funding over three years to help smaller businesses accelerate their adoption of key information and communications technology (ICT). The new funding for the Industrial Research Assistance Program will be delivered through collaborative projects between companies and colleges.

The budget notes that BDC has made it a strategic focus to help businesses accelerate their use of ICT.

Here are some other key measures announced in the budget that are of interest to entrepreneurs:

• There are no tax increases in the budget, nor are there any changes to previously promised tax rate reductions.
• The budget provides for a temporary Hiring Credit for Small Business of up to $1,000 against a small firm’s increase in its 2011 Employment Insurance premiums over those paid in 2010. This temporary credit will be available to about 525,000 employers whose total EI premiums were at or below $10,000 in 2010, reducing their 2011 payroll costs by about $165 million.
• Support for the manufacturing and processing sector will be provided by extending the accelerated capital cost allowance treatment for investments in machinery and equipment for two years.
• Other measures for smaller businesses include reducing their compliance burden through the Red Tape Reduction Commission and upgrading the BizPaL service. The commission, chaired by the Minister of State (Small Business and Tourism), is taking the perspectives of small business into account in identifying irritants stemming from federal regulatory requirements. BizPaL is a free online service for small business owners through which they can create a tailored list of permits and licences that are required from all levels of government to operate their business.The budget provides $3 million per year to make BizPaL permanent and allow the program to upgrade its technology infrastructure to provide even greater value to small businesses.
• The budget allocates $20 million over two years to enable the Canadian Youth Business Foundation to continue its support for young entrepreneurs.
• The budget provides $100 million per year in funding to the Canada Media Fund for investments in the creation of digital content across multiple platforms.
• The budget allocates $2.2 billion in support of the conclusion of an agreement between Canada and Quebec on sales tax harmonization.

Commercialization and Business Innovation

• The budget supports 30 new Industrial Research Chairs at colleges with $3 million in 2011–12 and $5 million a year on a permanent basis starting in 2012–13.
• In addition, the budget announces $53.5 million over five years to support the creation of 10 new Canada Excellence Research Chairs. Some of these new research chairs will be active in fields relevant to the Digital Economy Strategy.
• The government will allocate $12 million over five years, starting in 2011–12, to the Idea to Innovation program to support joint college-university commercialization projects.

Clean energy/technology

• The budget includes measures that support the development of clean energy technologies with $97 million over two years to renew funding for technology and innovation in the areas of clean energy and energy efficiency.
• It also provides $40 million over two years to Sustainable Development Technology Canada to continue to support the development and demonstration of new clean technology projects.

Aboriginal entrepreneurship

• A new Framework for Aboriginal Economic Development is focused on strengthening aboriginal entrepreneurship, supporting aboriginal skills development, enhancing the value of aboriginal assets and forging new and effective partnerships with provinces, territories and the private sector. As part of the implementation of the framework, the government is investing $200 million.

For more information, consult the budget document.