With no mention of flow-through shares for the tech sector in the Liberals’ recent budget, the group pushing for the investment mechanism is planning an alternate approach.
Canada Flowthrough Shares is a founder-driven coalition advocating flow-through shares for tech as a way to unlock angel and seed capital for Canadian startups.
In a recent news release, the group said that, in the absence of a budget announcement, it will take a “pipes-to-taps” pivot, which involves a push for provincial pilots of flow-through shares for tech, followed by a request for a “small federal regulatory sandbox to validate the model nationally.”
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“We didn’t get FTS-for-tech in this budget,” said David Perry, managing partner at Perry-Martel International and lead organizer of Canada Flowthrough Shares. “We did get the pipes — AI/quantum capacity, modern payments rails, and better SR&ED. Our job now is to turn those pipes into taps of private risk capital, fast.”
In a federal budget briefing note, law firm Osler noted that “a new flow-through share regime for artificial intelligence, quantum computing, biotech and advanced manufacturing companies modelled on the existing flow-through share regime available to mining exploration companies” was not included in the recent budget.
The omission was notable, Osler said, since a proposal was mentioned in the Liberals’ April 2025 election platform.
According to the news release from Canada Flowthrough Shares, the group plans to invite provinces to harmonize existing investor-credit frameworks into a Tech-FTS Pilot Network with common rules. Then, it would ask the federal government for a two-year pilot “aligned with national innovation investments.”
Performance measures would include time-to-market reduction and follow-on capital, with results published quarterly.
“Canada already knows how to do investor incentives responsibly,” said Paul LaBarge, founding partner at LaBarge Weinstein LLP, in the release. “With clear eligibility, caps, hold periods, and ‘no double-dip’ rules alongside SR&ED, an FTS-for-Tech pilot can include innovators and angels where it matters most — at seed — while protecting the taxpayer.
“The point isn’t a tax shelter; it’s investment efficiency and it’s targeted capital that builds teams, ships product, and anchors IP here at home,” he added.
The group also said that it will convene a Canada Tech Capital Coalition of provinces, angel groups, accelerators and other institutions to standardize the FTS-for-Tech pilot across jurisdictions and publish common KPIs.
“If tech wants a national voice, it starts with a national standard — one pilot, one data model, province by province, and a scoreboard the whole country can see,” Perry said.
“We don’t need a megaphone to get started — we need rules that work,” LaBarge added. “A capped, audited FTS-for-Tech pilot gives angels confidence, keeps IP here, and scales only if the data says it should.”
The group said in the release that its announcement is dedicated to John Reid, former president and CEO of the Canadian Advanced Technology Alliance (CATA), “whose founder-first advocacy set the bar for practical, job-creating policy.”
