Next Thursday, members of the startup community will have an opportunity to discuss a matter that has been on their minds for years – how to liberalize the patchwork of angel tax credits in the region.

Rob Barbara, Partner at Build Ventures, will lead a discussion on this subject at the Entrevestor-Entrepreneurs’ Forum dinner in Halifax. The goal is to come up with new ideas, maybe even a consensus, on how to improve the system for incentivizing angels to invest in startups.

(After this discussion, Innovacorp CEO Stephen Duff will chair a talk on mentorship, which is a follow-on discussion to our dinner in Fredericton in May.)

Entrevestor-EF dinners are opportunities for members of the community – founders, funders and support organizations – to come together and discuss ways to improve the local ecosystem. There are still some tickets left for the Halifax dinner on Sept. 25, which you can order here.

In discussing the challenges of angel tax credits, we will be shining a spotlight on programs that are definitely helping startups but could be doing more.

Each province in the region has its own incentive, all with different names. For the record, the incentives officially are called Small Business Investor Tax Credit in New Brunswick, Direct Equity Tax Credit in Newfoundland and Labrador, Equity Tax Credit in Nova Scotia and Share Purchase Tax Credit in P.E.I.

They have one thing in common – they can be claimed only by residents of a province investing in companies based in that province. For years, people within the community have been arguing that startups – and the economy overall – would benefit if the programs were harmonized and improved. Above all, people crying for reform want the tax credit to be granted to people living outside the borders of each particular province.

Why would the economy overall benefit? Because these incentives help dynamic companies, and even lead to higher tax revenue. A 2010 study for the Ministry of Small Business, Technology and Economic Development in B.C. found that for every dollar granted to startups in provincial tax credits, the province receives $1.98 in taxes. By attracting more money into startups, the economy would grow and provincial revenues rise.

Our discussion wants to look at whether it would be practical to develop a regional tax credit so all the angels in the region could be incentivized to invest in companies from around Atlantic Canada. It would mean harmonizing the programs, as there are now some big differences. The maximum eligible investment is $250,000 in New Brunswick and $50,000 in Nova Scotia and Newfoundland.

The biggest question – meaning it’s the hardest to achieve but could have the biggest benefit – is whether these incentives could be granted to people outside the region. States such as Arkansas and Minnesota have ways for people outside their borders to claim tax credits for investments. It means capital flows into growing businesses.

We want hear your views on this important subject. Please come to the dinner next Thursday at the Niche Lounge in Halifax and join the conversation.