Canada CCUS Investment Tax Credit (ITC)

The Carbon Capture, Utilization and Storage Investment Tax Credit is a refundable federal credit for eligible CCUS capital expenditure from January 1, 2022 to December 31, 2040, enacted through Bill C-59 (royal assent June 20, 2024) and administered by Natural Resources Canada (project-plan evaluation) with the Canada Revenue Agency (claims). Rates for 2022-2030 are 60% for direct-air-capture equipment, 50% for other capture, and 37.5% for transport, storage and use, halving for 2031-2040; 10 percentage points are lost without meeting prevailing-wage and apprenticeship requirements for property prepared or installed after November 28, 2023. Support of about $11.4 billion is expected through 2027-28. Eligibility hinges on a qualified project with a ~20-year review period and at least 10% eligible use each period (with clawback on shortfall): eligible use is solely dedicated geological storage with no enhanced oil recovery, or qualified concrete storage in Canada or the United States. The design answers the U.S. 45Q with a Canadian instrument favouring permanent storage.