Chapter 1: 
Canada's Investment Supercycle

A new era of investment, productivity, and growth in Canada

The world is changing rapidly. Global trade is being rewired, conflicts continue in Europe and the Middle East, and the allocation of capital, energy, and technology is being reset.

Canada, like many major economies, is experiencing that profound change firsthand. But Canada's new government is focused on what can be controlled—and we are capitalising on our advantages. We are seizing a unique investment opportunity to build at a scale worthy of our potential. Canada is building faster, thinking bigger, and forging an economy that is stronger at home and more diversely connected around the world.

Canada has what the world wants, from energy, critical minerals, and clean electricity to core capabilities in aerospace, cyber, artificial intelligence (AI), and quantum. Our economy has never been more connected or more ambitious. We have signed over 20 economic and security deals on five continents over the last year. Canadian businesses now have access to 1.5 billion consumers representing nearly two thirds of global gross domestic product (GDP), and we are on track to double that market access in the next few months. We are a reliable, trusted, and stable partner in a world where trust is a defining value.

Canada enters this phase from a position of economic resilience and is well positioned for growth, with the IMF projecting the second-fastest growth in the G7 in 2027. We have set an ambitious goal to double our exports to non-U.S. markets over the next decade. Canada has recorded the highest foreign direct investment per capita in the G7 since 2025, well above its nearest G7 peer, and has been ranked the most attractive country in the world for infrastructure investment.

Today, public investment, private capital, and new market opportunities are coming together in ways that support a new period of sustained growth and resilience: Canada's Investment Supercycle.

To seize the moment, Canada must become the best place in the world to invest. We are taking measures to support Canadian skilled workers and businesses to keep talent and investment in Canada. In doing so, we are strengthening productivity and building a stronger, more competitive economy. This means greater prosperity for all Canadians, higher wages, and better living standards.

Budget 2026 makes it easier to invest in Canada, attract new investment to Canadian projects and industries, and draw more private capital into major infrastructure and nation-building projects.

We are focused on helping more homegrown businesses become global champions. Budget 2026 improves access to growth capital and strengthens research and commercialisation while protecting intellectual property.

Together, these actions help entrepreneurs, researchers, and businesses start, scale, and succeed in Canada. They will create more jobs and build a stronger economy here at home, ensuring that Canadians make choices from a position of strength and prosperity.

Taking action in Budget 2026

Budget 2026 advances the government's plan to build a stronger, more competitive, more resilient Canadian economy. Key measures include:

• The Productivity Mega Deduction, giving Canada the lowest tax rate on new business investment in the G7 and providing businesses of all sizes and sectors a stronger incentive to invest, expand, and produce more.
• New incentives for entrepreneurs and investors to build, grow, and reinvest in eligible Canadian companies.
• More of Canada's research and ideas turned into successful products and businesses.
• A stronger, larger electricity grid to meet growing demand and deliver more clean, affordable power.
• More Canadian critical minerals brought from mine to market.
• A growing nuclear industry that creates jobs at home and competes for opportunities around the world.
• Stronger competition across the economy, including the financial sector, to support greater access to capital, encourage investment and innovation, and drive productivity.

These measures build on the strong economic plan we are already implementing to catalyse investment and support long-term growth:

• Nearly $500 billion in new investment commitments were made at Canada's first Investment Summit in September 2026.
• More than 150 infrastructure investments are already underway through the $51 billion Build Communities Strong Fund, supporting housing, health care, public transit, and communities in need.
• Changes to the Advance Income Tax Rulings program are fast-tracking Canada Revenue Agency rulings and providing greater certainty for investments of $1 billion or more in Canada, giving businesses greater confidence to build in Canada.
• Top global talent and exceptional researchers are being attracted to Canada through the International Talent Attraction Strategy and Action Plan, including ongoing work to attract over a thousand highly qualified international researchers.
• Canada's National Electricity Strategy, Nuclear Energy Strategy, and Canadian Critical Minerals Strategy are giving businesses and investors greater certainty while reinforcing our position as a global energy and resources superpower.

1.1 Making Canada the best place to invest

The world is more uncertain, and countries are competing for capital required to create and sustain high-paying careers, build major projects, and grow their economies.

Canada has a competitive edge. We have strong fundamentals. We are a reliable and trusted partner to our allies and partners around the world. We have stable institutions, skilled workers, abundant natural resources, and access to global markets needed to compete and win. Budget 2026 builds on these strengths and helps Canadian entrepreneurs and innovative businesses grow and succeed at home. Together these factors help make Canada the best place in the world to invest.

Kickstarting Canada's Investment Supercycle with the Productivity Mega Deduction

In September 2026, we announced the Productivity Mega Deduction. Building on the Productivity Super Deduction introduced last year, the Productivity Mega Deduction allows businesses to immediately write off the full cost of a broader range of capital assets, representing more than 65% of investment, on a permanent basis. This gives businesses the certainty they need to make major investment decisions, offering greater cost efficiency, competitiveness, and simplicity. Private investment in new machinery, technology, and other assets is one of the best ways to increase productivity, create jobs, and strengthen long-term growth.

With the Productivity Mega Deduction, Canada's marginal effective tax rate (METR) on new business investment will fall from 13% to 6.4%—the lowest in the G7 and less than half the rate in the United States. That makes Canada more tax competitive than the U.S. across all major sectors of the economy.

The Productivity Mega Deduction also gives Canada the lowest tax rate on new business investment of any major economy in the world. 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.

For businesses, lower effective marginal tax rates increase the after-tax rate of return on new investment, strengthening the incentive to invest in the machinery, equipment, and technologies needed to expand production. Together with the broader package of accelerated depreciation measures introduced since Budget 2025, the Productivity Mega Deduction will support higher investment and capital accumulation across sectors, expanding the economy's productive capacity over time.

This list of assets is illustrative. Once legislation is tabled, the Canada Revenue Agency will be responsible for determining whether specific assets qualify for the Productivity Mega Deduction based on the facts of each particular case.

The limited exclusions from the Productivity Mega Deduction are generally either very long-lived assets, assets that have a significant personal use component, or assets subject to regulated rates. These exclusions generally align with exclusions under 100% bonus depreciation provided in the U.S. The Canadian approach to immediate expensing is competitive for investors compared with the United States.

Rewarding innovation by helping Canadian ideas and talent succeed

New ideas, technologies, and businesses create jobs, raise incomes, and keep Canada's economy globally competitive. Canada is home to many talented entrepreneurs, skilled researchers, and innovators. But turning a good idea into a successful business requires access to capital, talented workers, and opportunities to grow.

Budget 2026 will help Canadian businesses and talent succeed. Its measures will improve access to growth capital, attract world-class talent to our growing sectors, and strengthen support for research and commercialisation opportunities while protecting intellectual property. By boosting and rewarding Canadian innovation, we are helping more of our businesses start, scale, and compete worldwide.

Backing Canada's next generation of entrepreneurs

Canada shares a border with one of the world's largest economic powers. To compete, we must be ambitious and ensure Canadian entrepreneurs have the opportunities, access to capital, and confidence they need to build and grow here at home.

Canadian high-growth startups drive innovation across the economy. Yet too often, their lack of access to growth capital holds them back. Talent and ideas leave Canada and take root elsewhere. To counter this, Canada must aggressively compete to attract and retain those that will create the next generation of Canadian businesses. That demands strong, pro-entrepreneurial action.

That's why Budget 2026 takes bold steps to strengthen Canada's innovation ecosystem by increasing the incentives for risk-taking, enabling successful investors and founders to reinvest in new Canadian companies while mobilising new domestic capital to support Canadian businesses. This includes:

• Introducing the Canada Growth Incentive to help high-potential businesses attract investment and grow in Canada, consisting of two measures: introducing a new tax exemption for Canadian builders on up to $15 million in capital gains earned from successful investments in eligible Canadian companies and enhancing the small business rollover to allow increased deferral of taxes on capital gains when proceeds are reinvested in another Canadian small business. By allowing builders to keep more of the benefits when a business succeeds, these measures will help level the playing field with the United States, encourage more capital to flow to Canadian businesses, and enable successful entrepreneurs to reinvest their proceeds into Canada. This incentive would provide $715 million in tax relief over four years, starting in 2027-28.

Together, these measures would mean that a founder has a stronger incentive to build a valuable company in Canada, an early-stage employee sees more upside in accepting equity as part of their compensation, and an investor gets a better potential after-tax return for backing a promising Canadian company. For a founder with a $15 million capital gain, that difference is substantial: they would retain nearly 96% of the value when they exit, compared with 71% before Budget 2026.

The Canada Growth Incentive will be one of the most significant incentives to attract and retain builders here in Canada. By creating the path for entrepreneurs, investors, and employees to reinvest in Canada, we are firmly backing our builders to drive innovation, growth, and jobs, ensuring that Canada does not face a "brain drain." Combined with the Productivity Mega Deduction, this represents a level shift in the attractiveness of firms, large and small, to invest—and reinvest—in Canada, and deliver lasting prosperity for all Canadians.

Helping Canadian innovators scale at home

Canada's economic security depends on innovative Canadian founders who start companies, commercialise new ideas, and scale up their businesses while remaining anchored to Canada. That is how we create good jobs at home and reap the greatest benefits from our world-class workforce and ingenuity.

Canada's Early and Growth Stage Investment Strategy, first announced in Budget 2025, addresses persistent financing gaps facing Canada's most promising firms. Through up to $750 million in investments, offered on a cash basis, the Strategy will mobilise domestic private capital and help Canadian companies grow and scale right here in Canada.

Delivered by the Business Development Bank of Canada, the Strategy includes:

• Pre-seed and Seed Investment Stream: $75 million to support investment in innovative early-stage companies.
• Later and Growth Stage Investment Stream: $675 million to increase the availability of domestic growth capital for Canadian companies as they expand and scale.

Together, these streams will help more promising Canadian companies access the capital they need to grow and scale here at home.

Boosting innovation and commercialisation

Canada's research and innovation agenda is entering a pivotal phase. Major projects are moving forward at speed and scale, and significant investments are being made in research, innovation, and emerging technologies. This is a competitive advantage for Canada. We have long been a global leader in these fields, and we can fuel our long-term economic growth and competitiveness by strongly supporting science and innovation. At a time when other countries are pulling back from research, Canada is doubling down. We are putting policies in place that attract leading researchers, innovators, and entrepreneurs from around the world, giving them the opportunity to contribute here.

Canadian businesses need a tax system that supports businesses of all sizes, from research and development through to commercialisation. Last year, we enhanced and simplified the Scientific Research and Experimental Development (SR&ED) tax incentive program by expanding access to the enhanced credit, restoring support for capital expenditures, and increasing the annual eligible expenditure limit on which the enhanced credit can be earned to $6 million to help businesses innovate and grow. To build on this momentum:

• Budget 2026 proposes to further expand the SR&ED tax incentive program to include certain commercialisation expenses. Eligible expenditures would be expanded to include certain costs associated with bringing a new product or process to market, including obtaining necessary regulatory approvals or certifications, and securing and maintaining intellectual property protection. This measure would apply to expenditures incurred in taxation years that begin on or after Budget Day. This measure is expected to provide support of $930 million over five years, with $235 million ongoing.
• In addition, the Canada Revenue Agency will work to provide sector-specific guidance to clarify SR&ED eligibility as it pertains to commercialisation expenses.

The inclusion of certain commercialisation expenses under the SR&ED program will provide an additional level of support for builders and businesses performing cutting-edge research and development, translating their intellectual and technological capital into commercial-ready ventures.

To fully realise the economic benefits of their new ideas, Canadian businesses must also be able to translate their innovations into commercial success and retain the value they create. This requires a competitive, transparent, and coordinated approach to intellectual property: one that helps Canadian businesses and entrepreneurs retain and capitalise on their ideas right here at home.

To support this, Budget 2025 announced the government's intention to undertake a performance review to strengthen Canada's intellectual property ecosystem and support the growth of intellectual-property-intensive firms. Budget 2026 announces several initial measures to deliver on that commitment, including:

• Modernising policies at Canada's three federal granting councils—the Natural Sciences and Engineering Research Council of Canada, the Social Sciences and Humanities Research Council, and the Canadian Institutes of Health Research—to improve commercialisation rates for publicly funded research.
• Initiating consultations with experts on how to strengthen technology transfer capacity at post-secondary institutions and help bring more Canadian research to market.
• Leveraging the expertise, capabilities, and assets of the National Research Council of Canada to identify ways to expand the impact of its intellectual property and support Canadian innovation and economic growth.
• Amending the Patent Act to require changes in patent ownership to be registered with the Canadian Intellectual Property Office, giving businesses and investors clearer information about who owns Canadian patents and helping reduce due diligence costs and investment risk.
• Developing new regulations under the Patent Act to establish minimum requirements for written patent demand letters. This will help protect Canadian businesses from abusive practices, including vague or misleading patent infringement claims intended to extract nuisance payments.

Further measures will be announced in spring 2027.

Targeted support can also help innovative businesses take on larger, riskier projects, as well as commercialise and scale new technologies. The Strategic Response Fund, initially launched in 2017 as the Strategic Innovation Fund, helps Canadian industries innovate, adapt, and compete by supporting large-scale projects that strengthen Canada's economy. To help bridge market gaps and catalyse investment in promising new innovations across the economy, including in areas like AI, agri-food, bio-manufacturing, and clean technologies:

• Budget 2026 proposes to provide $1 billion over six years, starting in 2028-29, to the Strategic Response Fund to support large-scale research and development and innovation projects that can strengthen Canada's long-term competitiveness and growth.

Unleashing billions for Canadian businesses with the Canada Investment Summit

Canada hosted its first-ever Canada Investment Summit in September 2026, welcoming investors to Toronto and showcasing Canada as the destination of choice for global capital.

The Summit brought together investors from nearly 30 countries responsible for managing more than $100 trillion in assets, along with federal ministers, senior officials, provincial representatives, and Indigenous leaders. More than 165 investment opportunities in priority sectors—including energy and critical minerals, artificial intelligence, defence, and infrastructure—were profiled.

Investors immediately recognised Canada's strengths and responded to our ambitions; by the end of the Summit, nearly $500 billion in new investment commitments to Canada had been made. As a result of the government's economic plan:

• Canada's top banks committed nearly $325 billion in new financing for Canadian businesses and infrastructure.
• Canada's leading pension funds, insurers, and institutional investors committed nearly $100 billion in new capital to Canadian assets.
• Investment funds committed to mobilise more than $14 billion in capital to grow Canadian companies, infrastructure, and strategic sectors.

On the margins of the Summit, Bell Canada, in partnership with the Government of Saskatchewan, announced a historic expansion of the Bell AI Fabric to build a 1.2-gigawatt Canadian AI infrastructure hub in Saskatchewan. This $52.5 billion capital investment is the largest in the province's history and is expected to create more than 4,500 jobs across construction, operations, management, and related services.

For Canadians, these investments mean tens of thousands of new jobs for skilled workers in every region of the country. They mean modern, robust infrastructure being built in Canada again—from stronger electricity grids powering our cities to the railways and roads that connect our country. They will fund our aerospace and defence industries of tomorrow while getting shovels in the ground on new mines and data centres today. The Canada Investment Summit advanced our most important mission: building a stronger, more independent, more resilient Canadian economy for all.

We remain focused on our goal of catalysing up to $1 trillion in total investment over five years, including $500 billion in new private sector investment.

Reaching that goal means keeping Canada top of mind for the world's biggest investors—and making sure that interest translates into investments that help Canadian projects, businesses, and workers. Invest in Canada, the federal agency that works to attract global investment to Canada, will have an expanded role in that effort. To help Invest in Canada deliver on this ambition:

• Budget 2026 proposes to provide $181.4 million over four years, starting in 2027-28, $50.4 million in future years, and $40.4 million ongoing to expand Invest in Canada to add specialised financial sector expertise and establish its presence in key global markets to bring in capital from major investors and multinational corporations. Invest in Canada will also deliver Canada's future Investment Summits.

Mobilising private investment to modernise Canada's airports

Canada's airports connect Canadians and support tourism, trade, and economic growth. Airport authorities have built and maintained a safe and reliable airport system for more than three decades. In the years to come, meeting growing demand for air travel, ensuring affordability, and improving the passenger experience will require additional investment and expertise.

To prepare Canada's air transportation system for the future, we are seeking private investment through long-term operating concessions for our four largest airports. Under this model, used successfully in other countries, experienced investors, like Canada's pension funds, would operate airports for 40 to 50 years while Canada retains ownership of airport lands and assets. Operators would be subject to strong oversight to protect travellers and the interests of Canadians.

The airport fees included in the price of an airline ticket would be subject to clear rules to protect travellers from unreasonable increases. New investment and expertise will improve airport services and infrastructure—making travel more efficient and expanding travel and tourism options. Canadians will share directly in the success of concessions through equity stakes for the Canada Strong Fund and local Indigenous communities.

• To launch the first airport operating concession, Budget 2026 proposes to provide $37.6 million over three years, starting in 2026-27, to ensure a strong return for Canadians by completing due diligence, developing the concession framework, obtaining specialised commercial and legal advice, and completing a competitive process to select the operator by early 2029. Budget 2026 also proposes to introduce legislation necessary to implement and establish the operating concessions.

The transition to the new model is part of the government's broader plan to build a more affordable, connected, and competitive air sector. Fiscal proceeds from the new model will be reinvested to benefit Canadians. They will support improvements across the air transportation system (e.g., regional airports, air connections between communities, and local transportation infrastructure) while helping build the infrastructure Canada needs. This could include helping to finance a sovereign broadband backbone that connects Canadians from coast to coast, with more direct and secure links to Europe and Asia. 

• Budget 2026 announces the government's intention to pursue additional measures—supported by concession proceeds—to improve the experience for travellers. These will prioritise regional connectivity, ensure air travel is affordable, and strengthen the governance and oversight of Canada's airports. Detailed measures will be developed and released over time. They will:
  • Improve access to air travel in regional, remote, and northern communities by supporting new air routes and investing in infrastructure at smaller regional airports.
  • Adjust the ground rent formula to support growth at airports that will continue to operate under the existing model.
  • Introduce legislation to improve transparency around airport fees, strengthen performance reporting and governance, and support economic development and accessibility.
  • Expand eligibility for the Airports Capital Assistance Program to include smaller airports in the National Airports System.
• Budget 2026 also proposes to provide $4.3 million over four years, starting in 2026-27, to Transport Canada to develop a Traveller Biometrics Strategy. The Strategy will make air travel faster and simpler, including through the potential use of digital credentials that can help travellers move through airports and other points of entry more efficiently. It will bring together airports, airlines, security screening, and border services, while protecting privacy, personal information, accessibility, cybersecurity, and individual choice. A Special Advisor on Traveller Biometrics will be appointed to lead this work and coordinate responsible and secure implementation across industry and government.

1.2 Building a cleaner, more competitive economy

Now more than ever, countries are competing to attract investment, build major projects, and secure reliable sources of energy. Canada can do all three.

By producing more clean electricity, reducing emissions, and helping Canadian businesses stay competitive, Canada will strengthen its economy and achieve its climate goals.

Budget 2026 builds on this approach with measures to expand Canada's electricity system, support investment in clean technologies, adopt zero-emission vehicles, attract private capital, and provide greater certainty for businesses. These actions will create jobs, strengthen energy security, and ensure Canada remains competitive as the global economy evolves.

Powering Canada Strong

Canada has the potential to be an energy superpower. We have abundant reserves; hydroelectric, wind, and nuclear capability; and a grid that is already among the cleanest and cheapest in the G7. Building upon this potential is how we secure our sovereignty, increase our exports, and become more self-reliant: it is, as it was for Québec when the term was first coined, an integral piece to being masters of our destiny.

Electricity is key to Canada's energy security, sovereignty, and affordability; we know that the nations that master electricity will own the 21st century. Canada starts with advantages: we already have a nearly 80% clean grid and some of the lowest electricity costs among peer nations.

But as our economy grows and our industries become more energy-intensive, electricity demand in Canada is expected to double by 2050. This is an enormous opportunity for Canada to build a sustainable, affordable future—but we have to start now. Increasing electrification will boost our energy sovereignty, give Canadian industries a competitive advantage, and lower energy costs for 7 in 10 Canadian families, playing a key part in the government's affordability efforts.

Electrification and your "energy wallet"

A household's "energy wallet" can be thought of as combined payments for gasoline, natural gas, and electricity. Electrification means more and better choice. In the future, the "electricity" slice of the pie will get much bigger, but for most, the entire pie will get smaller since households will be relying on more efficient forms of energy.

Budget 2026 is investing over $50 billion in bold and ambitious measures to expand Canada's electricity system, support investment in clean technologies, attract private capital, and provide greater certainty for businesses. These actions will create jobs, strengthen energy security, and ensure Canada remains competitive as the global economy evolves.

Announced in May 2026, Canada's National Electricity Strategy outlined how Canada can work with provinces, territories, Indigenous Peoples, utilities, unions, and other partners to double the capacity of our grid by 2050. The Strategy is guided by four pillars and eight key actions:

Mastering electricity also means finding the ways that greater electrification can interact and support priorities in other sectors. Canada's Automotive Strategy is helping Canadians choose electric and enhancing Canada's EV charging network, which makes it easier and more convenient for Canadians to drive their electric vehicles more. At the same time, we are helping retrofit one million homes with modern, energy-efficient technologies (including electric heat pumps), reducing energy use, lowering emissions, and helping Canadians save money on their energy bills.

The message to the world is clear: if you need clean, affordable power, Canada is your answer.

Budget 2026 builds on this momentum with measures to unlock investment, build capacity for more generation and transmission, and improve the reliability of electricity systems across the country, so that we can power Canada Strong.

The Clean Technology and Clean Electricity investment tax credits help catalyse and unlock investment across the economy, from renewable energy systems to electricity transmission.

• To provide the certainty needed for longer-term projects, Budget 2026 proposes to extend the Clean Technology and Clean Electricity investment tax credits to the end of 2040. For the Clean Technology investment tax credit, the phase-out to 15% would occur in 2040 rather than 2034.
• To encourage more investment in electricity transmission, Budget 2026 proposes to expand eligibility for the Clean Electricity investment tax credit to the highest-voltage intra-provincial electricity transmission lines in each province, for property acquired and available for use on or after Budget Day.

Combined, these measures are expected to cost $2.4 billion from 2027-28 to 2030-31 and $36.1 billion from 2031-32 to 2041-42.

As global supply chains evolve and economic partnerships are reshaped, Canada must ensure that Canadian workers and industries fully benefit from new investment opportunities. The Government is committed to this objective.

To meet that commitment, the Government will conduct targeted consultations with stakeholders over the next 60 days to determine the scope and parameters of a domestic content bonus of up to 10 percentage points under the Clean Technology investment tax credit and up to 5 percentage points under the Clean Electricity investment tax credit. This will support the use of Canadian industrial products in the projects needed to double Canada's production and transmission of electricity. 

In addition, Budget 2026 proposes further investments to expand, strengthen, and better connect Canada's electricity systems.

• To deliver more reliable power as electricity demand grows, Budget 2026 proposes to provide nearly $4 billion over 10 years, starting in 2027-28. This funding will support electricity infrastructure expansion, renewable energy, and priority electricity sector projects across Canada, including new funding for the Smart Renewables and Electrification Pathways Program.
• Our electricity grids in Canada are currently far too fragmented. Stronger interties can better connect electricity systems across Canada, allowing electricity to move more easily across provincial and territorial borders. Budget 2026 proposes to provide $37 million in 2027-28 to support robust cost-benefit analysis of proposed interties and inform cross-border cost-allocation discussions.
• To support the allocation of investment for Canada's electricity system buildout, Budget 2026 proposes to provide $26.4 million over 10 years (on a cash basis) to Natural Resources Canada for data and modelling capacity to improve system planning and help guide investments where they will be most beneficial. Budget 2026 also proposes to provide $22.9 million over five years to Environment and Climate Change Canada to update the Clean Electricity Regulations and to develop equivalency agreements with provinces and territories where appropriate.
• Growing Canada's electricity system will require substantial investment. The measures above will help protect the affordability of Canada's electricity, which is important for economic growth and competitiveness. As a complement to ongoing efforts to grow Canada's electricity system in a way that safeguards affordability, Canada's new government intends to begin working with interested provinces and territories to develop new approaches to financing the largest and most transformational electricity sector projects across the infrastructure lifecycle to support our competitiveness and energy sovereignty.
• To improve energy reliability in the North, Budget 2026 proposes to provide $1.6 billion over 10 years, starting in 2027-28. This includes $713.8 million for renewable energy and capacity-building projects that help Indigenous, rural, and remote communities transition from diesel and fossil fuels to renewable energy sources, and $929.1 million to replace and upgrade aging electricity infrastructure in northern communities. This funding will support the Mayo Hydro Facility and Atlin Hydro Expansion projects.

The Mayo and Atlin projects would together help strengthen the reliability of Yukon's electricity system by protecting critical existing generation capacity and bringing new power to the grid. Upgrades to the Mayo Hydro Facility would safeguard 15 megawatts of dependable hydroelectricity and help address winter blackout risks as record-breaking demand places increasing pressure on Yukon's grid. The Atlin Hydro Expansion would bring additional hydroelectricity from northern British Columbia to Yukon, with the potential to add eight megawatts of capacity to Yukon's grid and generate 31 gigawatt hours each winter, equivalent to the annual electricity use of approximately 2,500 Yukon homes.

As demand for electricity grows, Canada needs new sources of reliable power that can be brought online quickly to enable investment, strengthen energy security, and support a more competitive economy. Positioning Canada at the frontier of emerging low-carbon technologies can help meet growing electricity needs while creating new opportunities for Canadian industries and workers.

• To realise this opportunity, Budget 2026 proposes to provide $6 billion over six years, starting in 2028-29, earmarked to support the deployment of emerging electricity generation technologies.

Solid oxide fuel cells are an example of emerging technology for power generation

Solid oxide fuel cells (SOFCs) can provide efficient, reliable power to help meet the needs of growing data centres and other energy-intensive industries. Greater access to power could support the expansion of digital infrastructure in Canada, strengthening data sovereignty. SOFCs also use relatively little water, produce very low levels of conventional air pollutants, and create opportunities to build Canadian expertise and manufacturing capacity in an emerging energy technology.

Updating Canada's Clean Electricity Regulations

As electricity demand grows and Canada works to double the capacity of its grid, keeping electricity reliable and affordable will require flexibility in how power is generated. We intend to update the Clean Electricity Regulations to provide that flexibility while maintaining the goal of avoiding excessive emissions and achieving a net-zero electricity system by 2050. The proposed changes would:

• Allow existing electricity facilities to operate for longer, including where needed to maintain reliability.
• Provide more certainty for planned investments in electricity generation, as well as more flexibility, including, for example, for natural gas in the near term, as well as hybrid energy systems and distributed renewables, giving electricity systems more options to meet growing demand as the grid expands while still achieving net-zero by 2050.
• Make emissions reductions more cost-effective by allowing electricity producers to offset more of their emissions through verified reductions elsewhere in the sector and economy.

Any changes would maintain the net-zero by 2050 goal and continue to protect the environment and human health from climate change. The proposed changes will be subject to consultation.

Growing Canada's nuclear advantage and powering our electricity future

Nuclear energy is playing a growing role around the world as countries look for reliable, low-carbon electricity to meet rising demand and strengthen their energy security. Canada has a world-class nuclear sector and is well positioned to benefit from this demand, both domestically and internationally.

Nuclear energy is essential to powering Canada's future. It provides non-emitting, dependable baseload power, backed by a strong domestic supply chain built on over 70 years of Canadian expertise, innovation, and intellectual property.

Today, the nuclear sector is responsible for 90,000 direct and indirect jobs, and in the nuclear industry itself, 90% of jobs are in high-skilled roles. Nuclear energy contributes 13% of our national electricity supply, and it adds $22 billion to Canada's economy every year through the operation of 17 Canada Deuterium Uranium (CANDU) reactors at home and the servicing of nine reactors abroad in countries like Romania, India, and South Korea. We are committed to keeping this Canadian technology market-ready for use at home and in international markets.

Canada's nuclear export opportunity

Global demand for nuclear energy is growing. Global nuclear investment reached approximately $88 billion in 2023 and is projected to reach between $94 billion and $202 billion annually by 2030. At least 30 countries are pursuing their first nuclear builds, creating a significant opportunity for Canadian companies.

Canada is well positioned to compete for that investment. Homegrown CANDU technology is part of the opportunity, but Canadian manufacturers and service providers also have capabilities that support other reactor technologies, giving Canada a role in nuclear projects regardless of the technology selected.

Canada also has the tools to help its nuclear industry compete internationally. Export Development Canada offers financing, insurance, and risk-management products to help Canadian companies expand abroad, complementing Canada's technology, manufacturing, and service expertise.

In June 2026, we presented the Nuclear Energy Strategy for Canada, setting out a plan to grow the sector by unlocking investment, modernising regulation, strengthening Canadian research and development, and promoting Canadian nuclear expertise abroad. To implement key commitments under the Strategy, Budget 2026 proposes to provide $518.5 million over five years, starting in 2027-28, and $18.1 million ongoing to advance Canada's nuclear research, supply chains, workforce, and regulatory capacity. This includes:

• $261 million over five years, starting in 2027-28, and $14 million ongoing, to Natural Resources Canada to develop nuclear supply chains, support research and development, and advance research reactor capacity and readiness.
• $127 million over five years, starting in 2027-28, and $1 million ongoing, to Atomic Energy of Canada Limited for research infrastructure, research and development, workforce development, and other strategic nuclear capabilities.
• $131.1 million over five years, starting in 2027-28, to the Canadian Nuclear Safety Commission (CNSC) to prepare for new nuclear projects and become the sole federal regulator for nuclear energy projects. Of this amount, $18.3 million would be cost-recovered.
• $14.4 million over five years, starting in 2027-28, and $3.1 million ongoing, to Global Affairs Canada, for nuclear export promotion and government-to-government engagement.
• $3.3 million over five years, starting in 2027-28, to Health Canada to support the CNSC with expertise on the human health impacts of radiation exposure.

We have already taken significant steps to finance new nuclear projects, including up to $2 billion from the Canada Growth Fund for the Darlington Nuclear Project, alongside support for Indigenous participation through the Indigenous Loan Guarantee Program; $970 million in low-interest financing from the Canada Infrastructure Bank; and access to the refundable Clean Electricity investment tax credit. Export financing for up to $3 billion has also been made available, through Export Development Canada, for the construction of two new CANDU reactors in Romania.

The Indigenous Loan Guarantee Program, alongside Ontario through its Indigenous Opportunities Financing Program, will provide an approximately $715 million loan guarantee to allow seven First Nations in Ontario to own a significant minority interest in the Darlington New Nuclear Project. This transaction represents the largest Indigenous loan guarantee ever issued in Canada and one of the largest Indigenous investments in a major infrastructure project in Canadian history.

Expanding Canada's electric vehicle charging infrastructure

As more Canadians choose zero-emission vehicles, demand for electric vehicle chargers will continue to grow. Within five years, EV sales are projected to reach nearly 40% of global car sales. We have invested steadily to expand the charging network by supporting more than 50,000 chargers to date. A larger network makes it easier and more convenient for Canadians to drive electric vehicles, particularly in rural communities, helping Canada become a global leader in vehicle electrification.

Budget 2026 builds on this progress achieved, with the ambition to roughly double the number of federally supported chargers, making it easier for Canadian drivers to save money, plan their routes, and travel in confidence:

• To support the installation of over 55,000 additional EV chargers in areas where the infrastructure is needed most, Budget 2026 proposes to provide $587 million over five years, starting in 2027-28, to Environment and Climate Change Canada to renew the Zero-Emission Vehicle Infrastructure Program.
• To fund research and development for charging infrastructure, Budget 2026 proposes to provide $45 million over five years, starting in 2027-28, to Natural Resources Canada. This funding would help bring innovative Canadian EV charging solutions to market, delivering more affordable, reliable, and accessible EV charging solutions that work for Canadians, businesses, and the electricity grid.
• To support the transition of the federal fleet to zero-emission vehicles, Budget 2026 proposes to provide $2.2 million over five years, starting in 2027-28, to renew the Greening Government Operations Fleet Program, which conducts readiness assessments to support the transition of the federal vehicle fleet to zero-emission vehicles.

1.3 Unlocking the full potential of Canada's natural resources

Canada's energy and natural resources are a source of economic strength and a strategic advantage in an increasingly competitive world. Charting our own course requires us to capitalise on those strengths.

Budget 2026 advances measures that will bring Canada's reserves of in-demand critical minerals to market and work to support and modernise Canada's position as a world leader in forestry and wood products. A strong Canadian resource industry creates high-paying Canadian careers, supports Indigenous communities, grows our exports, and strengthens our economy. That is why we are delivering more of what the world needs.

Bringing critical minerals from mine to market

Canada stands as a global leader in mining and critical minerals, such as lithium, nickel, cobalt, and rare earth elements that are used in batteries, electric vehicles, and other clean technologies. We are known around the world for our mining schools, for our expertise and technology, and for the reliability we offer as a mining nation. But for too long, Canada has fallen behind in bringing those minerals from mine to market. That is why we are focused on increasing Canadian production and processing of our minerals.

That work includes strengthening the domestic supply chains that bring these minerals from mine to market. By working with Indigenous partners, industry, and international allies to responsibly develop more resource opportunities in Canada, we are creating good jobs and increasing our resource sovereignty. Critical minerals projects valued at over $44.6 billion were under construction or had completed the Impact Assessment or Environmental Assessment processes as of 2025, as well as select 2026 projects (Figure 1.10).

In the past year, Canada has signed over 50 critical minerals agreements with more than 15 countries, unlocking $20 billion in investment while reducing our reliance on foreign supply chains (Figure 1.11).

In July 2026, we announced the launch of the $2 billion Canada Critical Minerals Accelerator (CCMA). Delivered by Export Development Canada, the CCMA helps move priority critical mineral projects forward, allowing us to invest alongside industry in projects that strengthen Canada's supply of minerals needed for technologies such as batteries, semiconductors, and defence equipment. Canada announced its first agreement under the CCMA in support of Teck Resources' $850 million expansion of its Trail Operations in British Columbia, alongside a $400 million investment from the Canada Growth Fund announced this summer.

To build on this progress and unlock more of Canada's critical minerals potential, Budget 2026 proposes to:

• Renew the Canadian Critical Minerals Strategy, which supports strategic investments in the technology needed to mine and process our critical minerals, expands our geoscience and research capacity, provides targeted funding for priority critical minerals projects, and keeps government priorities aligned with market needs. Budget 2026 proposes to provide Natural Resources Canada with $424.4 million over four years, starting in 2027-28, to support this renewal.
• Extend the Mineral Exploration Tax Credit and Critical Mineral Exploration Tax Credit for an additional five years, until March 31, 2032. Budget 2026 also proposes to expand the Critical Mineral Exploration Tax Credit to include antimony. These measures are expected to provide $956 million in support of mineral exploration investment over five years, starting in 2026-27.
• Align the tax treatment of helium exploration and development expenditures, as well as expenditures incurred to acquire helium resource properties, with that of the conventional oil and gas sector. This change would also allow helium companies to benefit more from the proposed Productivity Mega Deduction, allowing them to immediately expense more capital investments in the helium sector. These amendments would apply to expenses incurred on or after Budget Day and are expected to provide tax relief of $54 million over four years, starting in 2027-28.

Chart 1.5 presents the policy approaches of nine countries across five key dimensions: strategic clarity, delivery architecture, funding and de-risking, evidence of execution, and sovereign capability. This analysis from a recent report (PwC's Mine 2026: Ambition to Action) finds that Canada is positioned as a global leader in critical minerals policy.

Strengthening Canada's forest sector

Canada has a world-renowned forest sector. It is the bedrock of hundreds of rural, remote, and Indigenous communities, employs nearly 200,000 workers, and is a staple of Canadian resource exports. In 2025, the sector contributed $29.7 billion to Canada's GDP.

Due to unjustified U.S. tariffs, changing global markets, and shifting wood product needs, our forest sector is facing significant pressures. The sector must improve its productivity and competitiveness to keep pace. That is why we are supporting and strengthening Canada's forest industry for the challenges of today and the demands of the future in Budget 2026. It proposes:

• $500 million over six years, starting in 2027-28, to Natural Resources Canada, to strengthen fibre supply chains and support provinces, territories, Indigenous partners, and industry in advancing forest management and stewardship, and deploying new technologies and practices.
• $2 billion over six years, starting in 2027-28, to Natural Resources Canada to help businesses in the forest sector modernise facilities and equipment, improve productivity, and expand production of higher-value products, as well as to support research, development, and demonstration projects.
• $4 billion over six years, starting in 2027-28, on a cash basis, to Export Development Canada through the Canada Account to support a new Forestry Sector Accelerator to make investments in new large-scale facilities and in major transformations of existing facilities, including biorefineries, biofuel facilities, and other facilities producing higher-value and innovative forest products.

1.4 Building a net-zero economy

There is no doubt we have a moral and economic imperative to address climate change. People and communities across Canada are experiencing the growing impact of climate change, with many Indigenous and northern communities facing particularly significant risks. At the same time, the global market for clean energy technologies is expected to exceed US$2 trillion by 2035, and countries that can build competitive clean industries and supply chains will be better positioned to capture these opportunities. Our path to a competitive, net-zero future is unique to us. It responds to the realities Canada faces and is integrated across our economic, energy and affordability policies. Our path to net-zero is about investing in the infrastructure, energy, and technologies that will make Canada more productive, competitive, and prosperous. The government cannot build a low-carbon, competitive economy alone. Achieving this transformation will require action from all parts of Canadian society, including provinces and territories, Indigenous Peoples, businesses, and communities.

Anchored on Canada's electricity advantage, Canada is building its way to a cleaner economy with four pillars:

• Build: Expand clean, reliable, and affordable electricity generation and transmission to power a growing economy.
• Switch: Electrify transportation, buildings, and industry, moving more of the economy to clean electricity and other lower-carbon alternatives.
• Transform: Improve energy efficiency and productivity so Canadian households and businesses use less energy, lower their costs, and become more competitive.
• Innovate: Develop, deploy, and export Canadian clean fuels and technologies, creating new industries and positioning Canada among the world's leaders in low-carbon competitiveness.

Budget 2026 is putting this plan into action with new investments proposed under each pillar. As set out in Section 1.2, we are building out Canada's electricity system by providing greater certainty for clean energy investment, including proposed measures like extending the Clean Technology and Clean Electricity investment tax credits to the end of 2040. We are also helping Canadians make the switch to electric technologies through the new National Heat Pump Rebate to support up to 820,000 households to install an electric heat pump, and proposed funding for the Zero-Emission Vehicle Infrastructure Program to install up to 55,000 EV charging stations to support increased EV adoption.

Budget 2026 proposes to renew funding for the Green Industrial Facilities and Manufacturing Program, now named the Strategic High-efficiency Industrial Facilities Transition, to optimise the energy efficiency of Canadian industrial and manufacturing facilities and help them remain competitive as demand grows for products with the lowest carbon footprint. We are also driving innovation through the proposed renewal of the Industrial Research Assistance Program Clean Technology Initiative. This program helps Canadian small- and medium-sized businesses commercialise clean technologies, supporting the development and deployment of the solutions needed for a lower-carbon economy.

Together, these investments will help Canada build more clean power, switch to electric technologies, waste less energy and bring new clean technologies to market. They will support the building blocks to transform and build Canada's competitive, net-zero economy.

Building a cleaner, more affordable and competitive economy

* Key Budget 2026 measures.

Advancing Canada's climate competitiveness

As global demand grows for clean technologies, low-carbon products, and sustainable solutions, Canada has an opportunity to contribute to emissions reductions at home and abroad while generating significant economic benefits. By lowering the carbon intensity of our exports, we can help reach global climate objectives while increasing their competitiveness abroad. Furthermore, by providing certainty on emissions policy, we can help businesses and clean technology developers have greater confidence in their operations as we continue to build a low-carbon future.

Last year, we established a framework to help with this transition: driving investment, encouraging innovation, and reducing Canada's emissions over time while maintaining Canada's competitiveness. This pragmatic approach provides businesses with greater certainty as they make long-term investment decisions; it also helps ensure Canada remains an attractive place to invest, grow a business, and create good, well-paying jobs.

To support the continued transition to a low-carbon economy, we are:

• Working to establish a predictable and effective carbon pricing system that supports emissions reductions while providing clarity for businesses and investors. As part of this effort, we intend to update the federal industrial carbon pricing benchmark to provide greater certainty for industrial emitters, clean technology developers, and capital markets, and to support continued investment in emissions reductions.
• Collaborating with provinces and territories to explore opportunities for ensuring greater alignment and linkages between carbon markets across Canada, improving market efficiency, and helping achieve emissions reductions at lower cost.
• Amending the Clean Electricity Regulations to provide greater flexibility while maintaining the goal of net-zero by 2050 and updating vehicle greenhouse gas emissions standards to reflect changes in consumer demand and advances in vehicle technology.

To further help Canadian businesses and industries adopt energy-saving technologies and reduce emissions:

• Budget 2026 proposes to provide $400 million over seven years, starting in 2027-28, to Environment and Climate Change Canada to support the renewal of the Green Industrial Facilities and Manufacturing Program, now named the Strategic High-efficiency Industrial Facilities Transition (SHIFT). SHIFT will de-risk projects and accelerate adoption of energy-saving technologies at industrial and manufacturing facilities, including small- and medium-sized enterprises.

• To help young Canadians shape Canada's transition to a low-carbon economy, the Youth Climate Corps, led by Employment and Social Development Canada, Natural Resources Canada, and Parks Canada, will help more than 2,000 young people gain the skills and experience needed for careers in climate-related and emergency management fields, strengthening Canada's workforce and supporting a clean, low-carbon, and resilient future.

Mobilising sustainable investment

As global demand for low-carbon goods and technologies grows, Canada is taking steps to help attract investment in the industries and projects that will drive future economic growth. Work is underway on the independently developed Made-in-Canada sustainable investment guidelines that will help direct investment toward low-carbon projects, with draft criteria for the electricity, transportation, and buildings sectors expected by the end of 2026. In addition, Budget 2026 proposes to:

• Develop a new Sustainable Bond Framework for government issuance, using the Made-in-Canada sustainable investment guidelines. This framework will be prepared by the Department of Finance Canada.
• Showcase progress on the Made-in-Canada sustainable investment guidelines and connect investors with new opportunities through a Sustainable Finance Conference that the Canadian Climate Institute will host in February 2027.

We also continue to advance disclosure requirements for environmental, social, and governance considerations, including climate-related risks, for federally regulated pension plans. These form part of a broader initiative to improve the transparency and governance of these plans.

We also continue to engage provinces and territories on supporting voluntary climate disclosures across the economy. Clear and comparable climate disclosures help firms access new markets, strengthen business resilience and investor confidence, and remain competitive in the face of growing reporting expectations from customers and investors at home and abroad.

1.5 Strengthening competition

Competition in the marketplace gives Canadians more choice and incentivises businesses to offer better prices, services, and products. When markets are difficult to enter, promising new businesses have fewer opportunities to grow, established firms face less pressure to improve, and consumers are left with fewer options and higher prices.

We have taken important steps to open markets and modernise rules to enhance competition, but barriers remain. It is vital that Canada continues to eliminate unnecessary restrictions and improve access to capital and infrastructure so that we have a more diverse set of players offering goods and services to Canadians. Growing our economy to build Canada Strong must also mean growing the number of options available to each of us, in all sectors and industries.

That's why Budget 2026 advances a whole-of-government approach to competition. It strengthens consumer protection, enhances affordability, and modernises financial sector frameworks and digital systems so Canadians and businesses can benefit from greater choice, lower prices, and new growth opportunities.

Advancing the Whole-of-Government Competition Plan

Building on the momentum from recent reforms, in the 2026 Spring Economic Update, we launched the Whole-of-Government Competition Plan, which expands Canada's competition agenda beyond individual sectors so that all government decision-making falls under a pro-competition lens. Through these efforts, we are reviewing federal policies, regulations, and programs to identify what unnecessarily limits competition while preserving important public policy objectives. The Competition Plan is advancing work across several areas:

• Cutting red tape to open markets: Initial reforms include several competition-enhancing measures identified through the Red Tape Review. Many of these are advancing through the Cutting Red Tape for All Canadians Act, while others are expected to be implemented by departments within the next 12 months. The Competition Plan will identify outdated or unnecessary rules that make it harder for new businesses to enter markets, existing businesses to grow and innovate, and Canadians to benefit from more choice and better value. This work will inform further regulatory reforms to strengthen competition.
• Opening federal contracts to more businesses: Public Services and Procurement Canada and the Treasury Board of Canada Secretariat are simplifying procurement rules, reducing paperwork, and improving transparency so that small- and medium-sized businesses can more easily compete for federal contracts. The Small Business Procurement Program will better align procurement regulations, helping bring more suppliers to the table, strengthen competition, and give Canadian businesses more opportunities to grow, while supporting broader procurement objectives, including the Buy Canadian Policy.
• Designing business supports to promote competition: We are reviewing how federal business support programs can give new and growing firms a fairer chance to compete, while keeping funding focused on its economic objectives. This will examine whether program rules make it easier—or harder—for businesses to enter markets, grow, and challenge established players. The findings will help improve program design and develop an approach that can be applied more broadly across federal business support programs over time. As part of this work:

• Budget 2026 announces the government's intention to assess and integrate competition considerations into federal business support programs, starting with the Strategic Response Fund.

• A Cabinet Directive on regulatory competitiveness: The federal Cabinet will ensure new regulations and the broader regulatory system are examined through a competitiveness, growth, and investment lens. The Cabinet Directive on Regulatory Competitiveness and Red Tape Reduction will help Canada advance a world-class regulatory system that protects the public interest while providing the efficiency and clarity needed for Canada to attract investment, support innovation, and strengthen Canada's long-term competitiveness.
• The Whole-of-Government Competition Plan is also advancing measures to strengthen competition, attract investment, and expand consumer choice across the Canadian economy. We will advance measures within federal jurisdiction and work with provinces and territories where coordinated action is required. Budget 2026 announces the government's intention to:

• Make it easier for consumers to switch providers: Expand data portability rights to additional sectors, including telecommunications and air transportation. These rights would be implemented following the establishment of the new data portability framework under the Protecting Privacy and Consumer Data Act, making it easier for Canadians to switch telecommunications providers and securely reuse their information when choosing different services.
• Strengthen Competition Bureau investigations: Make it easier for federal institutions to share relevant information with the Competition Bureau when it is investigating possible anti-competitive conduct, by formally recognising the Bureau as an investigative body under the Privacy Regulations. Information sharing would remain subject to the same legal limits and privacy protections that apply to other investigative bodies.
• Address restrictions on lower prices: Consult on potential reforms to address practices that prevent retailers from offering or advertising lower prices, such as suppliers pressuring stores not to discount products below a set price. The consultation would consider options to strengthen the Competition Bureau's ability to act when these practices limit price competition and make it harder for Canadians to find better deals.
• Remove anti-competitive property controls: Work with provinces and territories to end anti-competitive property controls that restrict competition in the retail grocery sector, building on Manitoba's new model for restrictions.
• Limit non-compete agreements: Work with provinces and territories to expand restrictions on non-compete agreements in employment contracts across Canada toward harmonised restrictions modelled on the federal approach.

To prevent new government initiatives from creating unnecessary barriers to competition, we are also embedding competition considerations into federal decision-making. As part of the Cabinet Directive on Regulatory Competitiveness and Red Tape Reduction, the Treasury Board of Canada Secretariat will integrate competitiveness impact assessment into the regulatory development process, while the Department of Finance Canada will do the same for budget and Cabinet decision-making. Each department will provide guidance and oversight in its area, with implementation targeted for winter 2027.

The Whole-of-Government Competition Plan, together with efforts to lower internal trade barriers, establishes a broad and ambitious agenda to strengthen competition across the economy and ensure pro-competitive policies are prioritised across government. Key elements of the Competition Plan and actions taken since 2025 to advance a more competitive Canadian economy are highlighted below.

Increasing competition in the telecommunications sector

Fast, reliable, and affordable Internet and cellular services are essential to how Canadians work, learn, run their businesses, and stay connected. Yet too many Canadians, particularly in rural and remote communities, still face gaps in coverage and reliability. While wireless prices have fallen, with the price of a 60 GB mobile plan falling from an average of $105 in 2022 to being widely available in the $40 to $50 range, Canadians continue to face limited choice, confusing offers, and barriers to switching providers.

To increase competition, affordability, and transparency for consumers, in October 2026 we published the Telecommunications Competition Roadmap announced in the 2026 Spring Economic Update. It sets out a coordinated plan to strengthen competition and affordability across Canada, while enabling investment in network infrastructure to support emerging technologies and data traffic growth. This marks the first time a federal government has set out a comprehensive telecom competition agenda covering everything from broad policy to specific regulatory actions.

Once implemented, the Roadmap will:

• Expand competition across the economy: Competitors need fair access to the infrastructure required to serve Canadians. The government and the Canadian Radio-television and Telecommunications Commission are advancing measures to help providers expand, including by finalising wholesale Internet rates, improving access to wireless networks, accelerating regulatory decisions, and resolving access disputes more quickly. New "dig-once" and tower-siting approaches will also lower construction costs and speed up network deployment.
• Help Canadians find better prices: Competition works best when Canadians can easily compare offers and switch providers. The Roadmap builds on new rules that eliminate fees to activate, change, or cancel a plan. It is expected to save consumers approximately $100 million each year. It will also promote more affordable plans, ensure transparency when shopping for Internet offers, simplify consumer protection rules, and improve awareness of the independent complaints process.
• Build stronger, more innovative networks: Canada also needs sustained investment in high-quality networks that reach every region. We will release more spectrum for 5G and private networks, support satellite services that can extend coverage in rural and remote areas, update spectrum transfer rules, and advance new infrastructure models that improve access for competition and significantly enhance investments in our national telecom network infrastructure.

These actions will support better coverage, faster services, and greater choice for Canadians, while strengthening the underlying digital infrastructure that businesses need to grow.

Increasing competition in the financial sector

Canada offers an attractive world-renowned capital environment, and the financial sector is integral to getting projects financed, growing our economy, and building Canada Strong. At the same time, it would benefit from being a more competitive market.

Budget 2026 builds on the government's existing reforms to improve Canada's financial sector. These measures, including consumer-driven banking and payments, will facilitate market entry, support firms as they grow and scale, and modernise regulatory and supervisory frameworks.

For Canadians, this means more choice, lower prices, and greater access to innovative financial services. For businesses, it means better access to the financing they need to invest, grow, and create jobs here in Canada.

Strengthening competition in OSFI's mandate

In a rapidly changing world, financial sector regulation must adapt and respond to evolving technologies, business models, and consumer needs. Canada is acting to ensure competition plays a greater role in how the Office of the Superintendent of Financial Institutions (OSFI) regulates. OSFI supervises federally regulated financial institutions, including banks, insurers, trust and loan companies, and federal credit unions. We are modernising how OSFI regulates and supervises these institutions as we maintain confidence in the reliability and resilience of Canada's financial system.

Budget 2026 announces the government's intention to:

• Introduce a secondary competition objective for OSFI through amendments to the Office of the Superintendent of Financial Institutions Act. This will help ensure that competition considerations, such as proportionality, compliance burden, and market impacts, are more clearly and consistently reflected in how OSFI regulates and supervises financial institutions.

Attracting new entrants and expanding competition

Canada has a stable, world-class financial sector. At the same time, it is important to attract more entrants and help them expand to improve products and services while lowering prices for consumers. Responsibly modernising the financial sector is a key part of the government's commitment to make life more affordable for Canadians.

To that end, Budget 2026 announces the government's intention to:

• Make the process for becoming a federally regulated financial institution more predictable, transparent, and timely by amending the Bank Act, Trust and Loan Companies Act, and Insurance Companies Act to establish a one-year timeline for making decisions on applications by new entrants.
• Expand exit options for deposit-taking institutions by amending the Bank Act and Trust and Loan Companies Act to allow for more flexibility to transfer assets and liabilities to other financial institutions. This will make it easier for solvent but troubled financial institutions to pursue private market solutions, while protecting depositors and helping consumers avoid costly service disruptions.
• Encourage the entry and growth of mid-sized challenger banks by amending the Bank Act to permit greater flexibility on ownership structures. This will be achieved by exempting foreign bank subsidiaries with less than $8 billion in equity from the public holding requirement, provided that their foreign parent is widely held and listed on a recognised foreign stock exchange, and raising the threshold at which banks must transition to widely held ownership from $12 billion to $25 billion in equity.
• Provide greater clarity and predictability for new and growing financial institutions through a policy statement issued by the Minister of Finance. The statement will provide guidance on how ministerial tools may be used to support the entry of federally regulated financial institutions, including credit union continuance, and promote a more proportionate and competition-supportive financial institutions framework.
• Make it easier for federal credit unions to access capital and pursue growth opportunities by amending the Bank Act to provide greater flexibility for qualifying cooperative shareholders to invest in and control a federal credit union. These changes will help credit unions expand their reach and serve more Canadians and businesses.

Expanding funding channels to support growth and competition

To build a stronger Canada and be masters of our destiny, Canadians need access to reliable funding to plan for the future. It helps households finance the major purchases they make and gives businesses the capital they need to compete and win.

Expanding funding opportunities will allow smaller institutions to expand into new markets, provide more mortgages and support business investment, and compete more effectively on pricing, products, and services. At the same time, stronger depositor protections will help Canadians safeguard more of their savings and support greater competition for deposits. To support these objectives, Budget 2026 announces the government's intention to:

• Modernise the deposit insurance framework by amending the Canada Deposit Insurance Corporation Act, including to increase the deposit insurance limit to $250,000, provide temporary high-balance coverage for certain life events, such as the sale of a home, and remove the limit for eligible deposits in registered and tax-free accounts.
• Work with small- and medium-sized deposit-taking institutions to better understand their funding needs and explore options to strengthen access to stable, cost-effective funding that supports growth, competition, and innovation.

Modernising Canada's prudential framework

The Office of the Superintendent of Financial Institutions (OSFI) is an independent federal agency responsible for the regulation and supervision of federally regulated financial institutions and pension plans. As an important part of the federal financial safety net, OSFI contributes to public confidence in the Canadian financial system.

As part of its broader modernisation agenda, OSFI is taking steps to make Canada's regulatory framework more transparent, proportionate, and responsive while maintaining resilience. Current initiatives include:

• Adjusting the capital framework and adapting prudential frameworks for small- and medium-sized deposit-taking institutions to better reflect their activities and risk profile, strengthening their ability to compete.
• Making targeted capital adjustments across federally regulated financial institutions that improve risk sensitivity and support sustainable economic growth while maintaining resilience.

These initiatives build on recent reforms to reduce unnecessary regulatory burden, streamline approvals, and ensure requirements are proportionate to the size and risk profile of institutions, helping support entry, growth, and competition in Canada's financial sector. Recent measures include OSFI's Streamlined Approvals Framework for Targeted New Entrants, a modernised Supervisory Framework, and the consolidation of more than 600 pages of guidance.

Notably, OSFI has also lowered the Domestic Stability Buffer, an additional capital cushion that Canada's largest banks are required to hold to help absorb losses during periods of stress. This measured adjustment reflects the sustained strength and resilience of Canada's domestic systemically important banks and frees up capital that can be deployed in support of the Canadian economy.

These measures, along with the government's proposed changes to the Office of the Superintendent of Financial Institutions Act, will help create a more open, competitive, and innovative banking sector, improve affordability and choice for consumers and businesses, and strengthen the conditions for long-term economic growth.

Unlocking infrastructure investment and economic growth

As we work to unlock the infrastructure investment and economic growth needed to get big things built at scale and speed, we know that access to long-term private capital is integral. We are taking action to expand infrastructure investment opportunities for Canadian life insurers to increase the capital available to Canadians. Budget 2026 announces the government's intention to:

• Expand infrastructure investment opportunities for Canadian life insurers by amending the Insurance Companies Act and the Investments in Permitted Infrastructure Entities Regulations to broaden the scope of permitted infrastructure investments. This will unlock additional capital that can be invested over the long term for infrastructure projects and support the construction of transportation networks, energy infrastructure, and other assets that strengthen Canada's economy, creating high-paying careers for Canadians.

Advancing the digital transformation of the financial system

From the applications they choose, to buying Canadian at the grocery store, to picking where they vacation—Canadians are ensuring that we are our own best customer.

As Canadians increasingly choose Canada, we are making sure that money can move quickly, safely, and conveniently. Modern payment systems are integral to a stronger and more resilient economy. Budget 2026 builds on significant progress to modernise Canada's payment ecosystem, including establishing a regulatory framework for payment service providers, expanding access to Payments Canada's systems, and supporting the launch of a new fast-payment system called the Real-Time Rail on November 9, 2026, which will enable individuals and businesses to send and receive data-rich payments instantly, with immediate access to funds. These efforts complement other initiatives underway to advance consumer-driven banking, establish Canada's stablecoin framework, and combat financial fraud.

Building on these foundational reforms, Budget 2026 announces the government's intention to:

• Launch the next phase of Canada's payments modernisation, guided by a public consultation expected in early 2027 on future priorities and the statutory review of the Canadian Payments Act.
• Strengthen the Bank of Canada's oversight of payment service providers through targeted amendments to the Retail Payment Activities Act.
• Work with provinces and territories to develop harmonised consumer protection requirements for payment service providers regulated under the Retail Payment Activities Act.
• Develop a pilot project for the use of voluntary digital credentials in financial services to support innovation and help combat identity fraud. The project would be developed by the Canadian Digital Service in collaboration with the Department of Finance Canada.

Collectively, these initiatives will help maximise the benefits of recent reforms, strengthen consumer protection, improve the governance and stewardship of Canada's payments infrastructure, and harness emerging technologies to deliver safer, more affordable financial services for Canadians and businesses.

We have also enacted the Stablecoin Act. With the Stablecoin Act, Canadians have a safer and more reliable way to make digital payments. The Act offers opportunities for faster and more efficient transactions, a broader range of payment options, and increased competition and innovation. At the same time, it introduces appropriate safeguards to protect consumers and maintain confidence in stablecoins. Alongside ongoing consultations on the proposed regulations under the Stablecoin Act, we are continuing to strengthen Canada's stablecoin framework by providing greater regulatory clarity and advancing work to strengthen consumer protections. To that end, Budget 2026 announces the government's intention to:

• Require federally regulated financial institutions to issue stablecoins through non-financial institution subsidiaries regulated under the Stablecoin Act and extend the Stablecoin Act to foreign financial institutions that are not prudentially regulated in Canada, to promote consistent regulatory treatment across stablecoin issuers.
• Continue to engage with stakeholders on options to strengthen consumer protections in the event of stablecoin issuer or custodian insolvency, while supporting responsible innovation in the stablecoin market.

Spotlight on gender and diversity impacts

Budget 2026 will help expand access to skills and economic opportunities as Canada builds a more clean and competitive economy, by:

• Expanding access to reliable, clean electricity with measures under the National Electricity Strategy, while reducing greenhouse gas emissions and contributing to long-term health and environmental benefits. These investments will also support skilled jobs and help create new opportunities for northern, remote, and Indigenous communities, supporting broader participation in the clean energy economy.
• Strengthening Canada's forest sector to support employment and economic opportunities in rural, remote, and Indigenous communities, particularly where the forest sector is a major source of jobs and economic activity. Indigenous Peoples and communities would benefit from enhanced opportunities to participate in forest stewardship, business development, and economic growth, helping build stronger local economies and more resilient forest-dependent communities.
• Expanding access to EV charging infrastructure, the Zero-Emission Vehicle Infrastructure Program supports new economic opportunities in the growing zero-emission vehicle sector, including jobs and skills related to the deployment, operation, and maintenance of clean transportation infrastructure.

Further information on the expected gender and diversity impacts of Budget 2026 measures across a range of population groups is provided in Annex 4.