Mining industry payments to Canadian governments reached $9 billion in 2011: Report
Amount nears peak period of 2007-2008 backed by higher prices and rise
OTTAWA, Sept. 10, 2012 /CNW/ - The Mining Association of Canada (MAC) today released its annual report
on mining industry payments to Canadian provincial and federal
governments. The report, prepared by ENTRANS Policy Research Group,
found payments reached an estimated $9 billion last year in aggregate
mining taxes and royalties, corporate income taxes and personal income
“The increase in payments made to federal and provincial governments
last year is directly related to the mining industry’s economic
strength during this period,” said Pierre Gratton, MAC’s President and
CEO. “Despite fiscal policy changes, notably the reduction in the
federal corporate tax rate in 2011, payment levels were buoyed by
generally higher metal prices and increased production.”
In fact, according to Natural Resources Canada, the mineral sector
experienced a 21% increase in the value of Canadian mineral production
in 2011 to a record $50 billion stemming from a combination of higher
prices and expanding output.
-- Total payments reached an estimated $9 billion in 2011. -- Royalty/mining tax payments increased by about $700 million over last year, with most of the increase coming from Alberta, Saskatchewan, Newfoundland and Labrador, and Ontario. -- The mineral sector has contributed $69 billion to government treasuries over the past 10 years -$30 billion to federal and $39 billion to provincial coffers.
Of particular note is the study’s findings that show a steady increase
in overall mining tax and royalty payments since the 2009/10 figures
seen during the international recession where payments to governments
declined almost 60% compared to 2008/09. In 2010/11, royalties and
mining taxes began to recover, increasing by 45% from $2.2 billion to
$3.2 billion. They increased by a further 20% in 2011/12 to $3.8
billion, which is well above the 10-year average.
Regionally, Alberta and Saskatchewan accounted for the largest portion
of royalties and mining taxes at 64% last year stemming from the
provinces’ respective strength in bitumen and coal, and potash and
uranium. Newfoundland and Labrador saw royalty and mining tax revenues
rise by almost 70% on the strength of higher iron ore and nickel
prices, and increased volumes from the Voisey’s Bay operation.
Ontario’s annual revenues more than doubled–from $72 million to $180
million–likely attributed to higher gold and copper prices.
“The strength of the study is that it measures one of the significant
economic contributions of the Canadian mining industry both nationally
and regionally,” said Gratton. “Canadians from coast to coast benefit
from a strong, competitive mining industry that supports critical
government services such as health care, education and skills training,
as well as creates hundreds of thousands of well-paying jobs.”
To view the report, please visit www.mining.ca.
The Mining Association of Canada is the national organization for the
Canadian mining industry. Its members account for most of Canada’s
production of base and precious metals, uranium, diamonds,
metallurgical coal, mined oil sands and industrial minerals and are
actively engaged in mineral exploration, mining, smelting, refining and
semi-fabrication. Please visit www.mining.ca.
SOURCE Mining Association of Canada (MAC)