r/AlmontyIndustries

The Government of Canada introduces new Productivity Mega Deduction to help businesses invest, grow and create jobs in Canada

https://www.canada.ca/en/department-finance/news/2026/10/the-government-of-canada-introduces-new-productivity-mega-deduction-to-help-businesses-invest-grow-and-create-jobs-in-canada.html

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Direct benefit for ALOY - SRC

The tax benefit flows directly to taxable private entities ---- specifically ALOY, its Canadian operating subsidiaries, or any taxable commercial joint-venture operating company that purchases, owns, or capitalizes equipment at the facility.

Loss Carryforwards vs. Immediate Cash

As commercial deliveries of separated heavy rare earth oxides (Dy, Tb) generate taxable revenue, the deduction provides a dollar-for-dollar shelter against operating profits.

The high-capex systems ALOY is financing - such as proprietary automated solvent extraction (SX) batteries, high-temperature metallization reduction furnaces, and casting lines - they are fully eligible for the 100% Year-1 deduction.

"This game-changing new tax incentive will increase the amount of assets eligible for immediate expensing from roughly 15% of assets to more than 65%, including fibre-optic cable, greenhouses, mining property, oil and gas pipelines, software, research and development, computer equipment, aircraft and vehicles, patents, rail track, bridges, and roads."

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https://www.dlapiper.com/en-ca/insights/publications/2026/09/canadas-productivity-mega-deduction-what-businesses-need-to-know

https://www.bdo.ca/insights/productivity-mega-deduction-business-tax-benefits-capital-investments-canada