Matching Trump’s corporate tax cuts on the full expensing of deductible property would have left the Canadian government with a $36.7 billion revenue hole between now and 2023, a new report from Canada’s Parliamentary Budget Officer says.

The analysis from the federal budget officer found that if Ottawa had moved forward with measures that would allow for a first-year 100 per cent tax writeoff for depreciable property purchased by a business, it would have cost the federal government $8.8 billion in 2019.

Over time, the annual cost of the policy would have declined to $5 billion in 2023. After that year, the cost would significantly drop after 2024 as the measure is phased out.

Corporate Canada had urged the Liberal government to pass tax cuts and boost investment incentives that match those passed by U.S. Congress in December 2017, based on fears investment and profits would shift south of the border.

Among the tax cuts passed under Tax Cuts and Jobs Act, which was strongly supported by U.S. President Donald Trump, were measures on bonus depreciation that would allow qualified property purchased by businesses between 2017 and 2022 to receive a 100 per cent tax writeoff in the year it is purchased.

BACKGROUNDER: Contending with Trump is focus of feds’ fall economic statement

Such depreciable property includes buildings, intellectual property and machinery and equipment — capital expenses usually deducted over several years. In 2015, corporations in Canada spent over $200 billion on new acquisitions of depreciable property.

Providing immediate expensing is meant to spur the purchase of capital assets that could boost productivity and grow the economy. Companies also tend to prefer quicker expensing based on the time value of money.

Finance Minister Bill Morneau declined to match the full extent of the Trump tax cuts, but had unveiled similar measures in the 2018 fall economic update meant to increase purchases of capital assets.

The fall statement announced full tax write offs specifically for the purchase of machinery and equipment used in manufacturing and processing of goods, as well as for clean technology and computer software.

It also brought in accelerated tax writeoffs for all businesses and other forms of qualified depreciable assets. For example, the first-year rate for the purchase of computers increased from 27.5 per cent to 82.5 per cent. Rate increases also applied to the purchase of buildings, aircraft and fibre optic cables.

These measures brought Canada’s marginal effective corporate tax rate — a measurement of the overall tax burden for companies in a country — significantly down compared to the U.S.

The government predicted that the measures would cost federal coffers $14.6 billion between 2018 and 2023, although such benefits was partially offset by higher-than-expected revenue returns.

READ MORE: Report calls on Ottawa to let companies immediately write-off new investments