Thank you, Peter.
Good afternoon to you, Madam Chair and honourable members of this committee.
I want to share with the committee Sustane's experience in interacting with the federal government as a Canadian start-up.
It's imperative that we have the research and development work that's being done by companies such as Sustane. Sustane has had direct interaction with SDTC, ISED, the strategic innovation fund, BDC, BDC Capital, ACOA and EDC, to name but a few.
Since COVID-19, there has been a desert of investors for start-ups like Sustane. The recent increase in the inclusion rate for taxable capital gains from 50% to 67% is a disincentive for investors, making it more difficult to raise capital in 2024. Less than 7%—or only $4 million—of the $60 million that Sustane has invested is federal grants or investment tax credits. Fully 73%—or $44 million—is equity and shareholder loans.
Why is there only $4 million in federal grants and tax credits?
When dealing with the federal agencies and funds, we were told that Sustane didn't qualify because it was too early in the process or too late in the process, or too large an investment, and then, ultimately, too small an investment. Generally, we were considered to be too small. I'll give you an example.
Minister Champagne visited Sustane's plant in April 2022 and introduced us to a senior bureaucrat who advised that Sustane needed to offset one million tonnes of greenhouse gas annually to qualify for a 25% capital refund. A Sustane plant—