Mining in Canada: Federal Budget Items for 2010

5 03 2010

Well, with the federal Budget-making season coming to an end, I can finally fill you in on what’s in Budget 2010 for the mining industry as well as resume posting entries on a steadier basis (yes!). There are two important items that have been included in Canada’s Budget for 2010.

First, and of surprise to roughly nobody, is the one-year extension of the Mineral Exploration Tax Credit. This tax measure is intended to help exploration firms raise capital by allowing them to transfer the tax deductions that they would normally be entitled to (but could not necessarily benefit from due to a lack of taxable income) to shareholders in the form of flow-through shares. This extension will provide up to C$55 million in tax relief. This tax credit has been extended from budget to budget since 2000 and mining industry association like PDAC have advocated making it permanent. I’m quite sceptical that this measure has contributed to exploration levels, but who wouldn’t take a tax break?

The second measure is entirely new and targets the regulatory requirements surrounding resource projects in the North. The Throne Speech earlier this month had hinted at those changes and many prominent mining industry associations have been praising this initiative. This Budget item provides the Indian and Northern Affairs Canada with more resource in order to streamline the review process as well as to carry reforms to improve the clarity and certainty of the process. The focus on the North is essentially in recognition of the large areas of land that are yet unmapped in this area and of the growing its growing contribution to the economy.

It’s Friday, I’m off to work. But stay tuned, I’m working on an interesting entry that I will publish very soon.

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One response

5 03 2010
ZVL- The ex-fed!

Is INAC this inefficient in carrying out their programs?

I wonder how much Native engagement they will impose, almost making it sound like Zimbabwe… wink wink!

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