A New Brunswick committee that includes both candidates for premier in the coming provincial election is calling for a regional equity tax credit to help fund startups and improve innovation in the region.

The New Brunswick Research and Innovation Council on Wednesday released its 2013-2014 annual report, which called for the development of a more entrepreneurial and tech-savvy society. Among its many recommendations, the council calls for a regional tax incentive that would allow investors in one province to invest in companies in another.

“The Government of New Brunswick should help its investors build bridges for new capital to flow into the province and accelerate the growth of our best companies,” says the report. “The creation of a regional tax incentive or similar vehicle would provide a unique value proposition for outside investors.”

It’s a significant move because private-sector investors and entrepreneurs have been calling for years for such a vehicle to encourage greater flexibility in financing growing businesses. The four provinces now each offer tax credits of 20 to 35 per cent to people investing in growing companies, but both the investor and company must be based in the same province.

Given that the population of each Atlantic province is so small, there have been calls to award the credits to people investing in any province in the region, thereby expanding the pool of investors.

This is probably the first time a committee that includes elected officials has supported regional tax credits.

Premier David Alward created the council last year so members of government, academia and the private sector could work together to improve research, innovation and entrepreneurship in the province. The premier co-chairs the council with Geoff Flood, CEO of tech consultancy T4G, and its 20 members include Opposition Leader Brian Gallant.

“This report outlines ways we can continue our momentum by building an increasingly digitized society which we feel offers an opportunity and platform for growth,” said Flood in a statement.

Overall, the report lays out three goals for New Brunswick to improve its economy and make government more responsive: build a digital society, establish an innovation-based procurement policy, and create an R&D infrastructure fund.

The council challenges New Brunswick to become “a North American leader in digital government services” by 2017. These services would include developing a single entry point and secure online access to all government services.

For its procurement policy, the council believes government departments, agencies and Crown corporations should earmark a specific percentage of overall procurement budgets for innovations created by local small businesses. It also calls on the government to join the New Brunswick Business Council’s early-adopter program to use the products of New Brunswick startups.

The council said New Brunswick should encourage public and private investors and academic institutions to work together to build up an R&D infrastructure fund, to invest in various forms of innovation in the province.