The Mining Association of Canada (MAC) has welcomed the federal government’s 2025 budget, calling it one of the most significant policy boosts for the country’s mining industry in years.
The budget outlines a suite of measures aimed at improving competitiveness, spurring investment in critical minerals, and strengthening Canada’s position as a reliable global supplier of key resources.
Among the headline items is a proposal to allocate CAD$2 billion over five years, starting in 2026–27, to create the Critical Minerals Sovereign Fund. Managed by Natural Resources Canada, the fund will make strategic investments in mining projects and companies. Furthermore, these include equity stakes, loan guarantees, and offtake agreements. The government designed the initiative to attract both domestic and international capital to projects for clean energy, defence, and technology supply chains.
In addition, the budget sets aside CAD$371.8 million over four years to launch the First and Last Mile Fund. The program targets bottlenecks that slow development of upstream and midstream mineral projects, helping more near-term operations move into production. This fund will absorb the existing Critical Minerals Infrastructure Fund and leverage up to CAD$1.5 billion in support through 2029–30. It will also finance clean energy and transport infrastructure tied to mineral development, especially in remote or northern areas.
Another key policy is the introduction of a Productivity Super-Deduction. This policy change allows businesses to immediately write off a larger share of their new capital investments. Industry leaders say this move could encourage adoption of new technologies and modernized equipment across Canada’s mining and processing sectors.
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Budget adds provisions for decarbonization, critical minerals
The government has also scrapped its previously proposed oil and gas emissions cap. In so doing, Ottawa has provided long-term certainty for energy producers and mining operations tied to the oil sands. The move is expected to reassure investors in companies such as Suncor Energy Inc. (TSE: SU) and Canadian Natural Resources Ltd. (TSE: CNQ), both of which have large-scale mining and extraction operations in Alberta.
Ottawa also plans to extend credit rates for the Carbon Capture, Utilization and Storage (CCUS) Tax Credit by five years. This change covers eligible expenditures made between 2022 and 2035. This extension gives major emitters additional time to invest in capture and storage technologies that reduce greenhouse gas emissions.
Furthermore, the Clean Technology Manufacturing Investment Tax Credit will now support polymetallic extraction and processing, a long-requested change from MAC. The list of minerals eligible for the credit will also grow to include antimony, indium, gallium, germanium, and scandium. These additions align with global demand trends and are expected to benefit both established producers and emerging companies such as Teck Resources Ltd. (TSE: TECK.B) and First Quantum Minerals Ltd. (TSE: FM).
Export Development Canada will also see its business capacity expanded by CAD$25 billion by 2030. This change enables the agency to deepen its trade and export financing for sectors like critical minerals, energy, and defence. This move aims to strengthen Canada’s role in supplying allied nations with responsibly sourced materials.
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Budget ushers in new era in mining investment
Other measures include renewing the Mineral Exploration Tax Credit until 2027, adding CAD$10 billion to the Canada Infrastructure Bank for national projects. It will also establish a CAD$1 billion Arctic Infrastructure Fund through Transport Canada. The government will also provide CAD$443 million over five years to support new processing technologies, joint investments with allied nations, and the creation of a critical minerals stockpile to reinforce Canadian and Allied security.
Additionally, the budget introduces several youth employment initiatives under the Youth Employment Strategy. Ottawa also plans to amend the Competition Act, removing certain greenwashing provisions but retaining protections against misleading environmental claims.
Pierre Gratton, MAC’s CEO, said that the budget confirms the federal government’s commitment to the critical minerals strategy released three years ago.
“Today’s budget promises to usher in a new era in mining investment, creating high paying jobs, boosting exports, creating major opportunities for Indigenous Canadians and protecting Canadian sovereignty for years to come. We urge the government to implement these proposals expeditiously,” said Gratton
Canada’s mining industry already contributes CAD$117 billion to national GDP and accounts for 21 per cent of total domestic exports. It employs about 711,000 people directly and indirectly across the country and remains the largest private-sector employer of Indigenous peoples.
Industry analysts say the 2025 budget could enhance Canada’s global competitiveness when nations are securing supplies of important minerals. If fully enacted, the measures are expected to draw new investment into both established and emerging mining hubs from northern Quebec to British Columbia’s Golden Triangle.
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