The climate for mineral exploration in Canada has become so oppressive that a great many companies are now looking beyond our borders for opportunities. The following quotation, taken from the 1990 annual report of Greenstone Resources, is typical of the perspective of many junior mining companies today. “Given the political and economic drift so clearly apparent in Canada, the high tax and labor rates in this country and the growing instability introduced by unreasonable environmentalists, native land claims, pressure groups and unions, we believe Greenstone’s emphasis on Latin America could not have been better timed.”
Exploration is the very future of mining industry, much the same as research and development is to manufacturing and high- tech industries. One cannot expect a direct or an immediate payback from the cost of exploration, but without it there would be no mining. The federal government’s 1988 decision to abruptly end tax incentives for mineral exploration without alleviating any of the counterbalancing tax levies is threatening to wipe out a large portion of the mineral exploration industry.
The federal government seems unable to comprehend the gravity of the situation. Mining is not like some other sectors of the economy, living off outdated equipment while supported for years by protective tariffs. Canada’s mining industry and exploration are among the most advanced and sophisticated in the world.
For want of a reasonable approach to taxation and regulation — not subsidies nor any other kind of special treatment — Canada could be condemned to watch one of its few vital industries, one that has already proven its ability to compete in the world marketplace, wither and die.
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