The Labour Sponsored Investment Fund Tax Credit will be eliminated by the end of the 2010 taxation year, Ontario’s Finance Minister Greg Sorbara says.

The province announced August 29 that it would end its involvement in the LSIF tax credit program and harmonize certain requirements to help funds move to the federal government’s Labour Sponsored Venture Capital Corporation program.

The province proposes to phase out the tax credit by maintaining it at 15% through the 2008 tax year, dropping it to 10% in 2009, and 5% in 2010.

The 5% incremental tax credit offered for Research Oriented Investment Funds would be phased out on the same timetable.

The Ministry says it will consult further with the industry on transition rules governing pacing, eligibility and other reporting requirements. “We’ve consulted the industry, and heard its views,” Sorbara said. “We’re committed to an orderly wind-down of this tax credit, and believe that this schedule will help accomplish that goal.”