Mining Industry Payments to Canadian Governments Soar



    VANCOUVER, June 18 /CNW Telbec/ - A new report released today by The
Mining Association of Canada indicates that the industry paid almost
$11 billion to Canadian governments in 2006, a significant increase from 2005.
    The Canadian mining industry operates approximately 180 producing mines
in Canada, with an important focus upon metals such as gold, copper and nickel
and non-metals such as coal, potash, diamonds and oil sands. The industry also
comprises 38 non-ferrous smelters and refineries producing refined aluminum,
copper, nickel, zinc and other metals. These three components of the industry,
generically known as "the mining industry", together employ 180 thousand
workers and, according to the study by ENTRANS Consultants, paid the following
amounts to governments in 2006:

    Royalties and Similar Payments  $2.33 billion
    Corporate Income Tax     $3.96 billion
    Personal Income Tax      $1.86 billion
    Total                    $8.15 billion

    The paper also highlights a significant year-on-year increase in these
payments. Payments in 2006 increased by approximately 50% over the
$5.5 billion payment total of 2005, reflecting the global price increases in
natural resources during this period.
    When a fourth component of the industry is included - fabricated metal
product manufacturing, which employs another 180 thousand workers - total
payments increase by an estimated $2.5 billion. This component was not
included in the ENTRANS study, although it is a component of the mining and
mineral manufacturing industry as defined by Natural Resources Canada. Added
together, the mining and mineral manufacturing industry paid around
$10.65 billion to Canadian governments in income taxes and royalties in 2006.
    "The payments to governments from Canada's mining sector have grown
significantly from 2005," stated Gordon Peeling, President and CEO of The
Mining Association of Canada. "Our industry benefits Canadians in multiple
ways - through jobs, investment and exports - and these latest results further
emphasize the industry's critical contribution to Canada's economic and fiscal
well-being."
    The ENTRANS paper also highlights the mining industry's contribution to
specific regions of Canada. The industry has become a very significant
contributor to the government revenue base in Newfoundland and Labrador, New
Brunswick, Manitoba, Saskatchewan, Alberta, British Columbia, and the
Northwest Territories.
    While the ENTRANS study focuses on income taxes and royalties, the
industry also contributes a considerable sum to governments in the form of
municipal taxes, fuel taxes and payroll taxes. In addition, the industry
purchases a significant amount of goods and services from an estimated 2400
supplier companies in Canada, ranging from engineering and environmental
consultants to equipment companies and financial firms. According to Natural
Resources Canada, the mining industry invested $2.6 billion in Canadian
mineral exploration and $20.6 billion in capital spending in 2007. Some
$16 billion of the capital spending is in oil sands mining facilities.
According to Alberta Energy, the oil sands industry also directed $1.96
billion during the year to the Alberta government in the form of land sales
payments.
    The ENTRANS summary primarily reflects 2006 income tax data, the most
recently-available. Figures for 2007 will be available in one year. Given that
the global prices of many minerals continued to increase in 2007, it is likely
that the mining industry payments to Canadian governments also increased
further in 2007.




For further information:

For further information: Paul Stothart, Vice President of Economic
Affairs at pstothart@mining.ca; or Maggie Papoulias, Director Government
Affairs at (613) 371-5007; or visit www.mining.ca


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