Op/Ed:Mining Tax Credit allows for greater investment
By Contributor
The mineral exploration and mining sector has long provided good middle class jobs for Canadians. Across the country, Canada’s mining sector directly and indirectly employs 634,000 Canadians, including over 30,000 in British Columbia alone. These jobs are critical for supporting our strong economy and communities throughout Canada.
Under the previous Conservative government, several mining-related tax credits were either reduced or cut entirely. These measures delayed development on some projects that needed to invest in exploration and operational costs. As a result, Canada fell behind our competitors. Our government recognized that this was the wrong approach for our mining industry, and we took decisive action. In our 2018 Fall Economic Statement, we announced significant initiatives to fix this situation and help create an environment where our mining sector can flourish.
First, our government is extending the Mineral Exploration Tax Credit (METC) for the next five years. This extension will allow for greater investment certainty in an industry that relies on innovation and discovery. The new extension of the METC will help Canada recapture the top global position for mineral exploration investment. As stated by the President of the Prospectors & Developers Association of Canada, our government’s commitment to extend the METC is “a monumental sign of support for the growth of, and investment in, Canada’s mineral exploration sector. The METC is a critical component of our industry that helps to catalyze investment in mineral exploration projects that leads to the discoveries that could become the mines of the future.”
Second, our government introduced the Accelerated Investment Incentive, which will give mining companies the ability to write off more of the eligible costs of newly-acquired assets in the year in which the investment is made. This will provide an important incentive to invest in Canada and in Canadian mines. This initiative is well-timed as Canada is currently benefitting from stronger commodity prices. This will allow Canada to take advantage of this opportunity and create more well-paying middle class jobs for British Columbians.
In order to have a sustainable mining industry, we need to encourage the full use of clean technology in the extraction of our resources. To achieve this goal, our government will allow companies to write off the full cost of clean energy equipment in their businesses. This will incentivize industry to pursue clean energy options and will encourage investments in northern British Columbia where clean energy alternatives are necessary.
Finally, our government is supporting the greener innovation sector through initiatives like Crush It – a national challenge to re-imagine how mining uses energy. This will help our industry develop new ways to make mining less carbon intensive. We will be selecting 12 organizations across Canada to have a chance to win $5 million for their innovative idea. By reducing the energy needed for this process, we can lower pollution, improve productivity, make our mining industry even more competitive, and transform the mining cycle.
I am proud to be part of a government that continues to support this important industry as we continue to work together to build a strong economy and provide good, middle class jobs for British Columbians.
The Honourable Harjit Sajjan is the Minister of National Defence and Member of Parliament for Vancouver South.
