TORONTO – Earlier this week Finance Minister Bill Morneau presented a 2018 fiscal update to the House of Commons. His promise to renew the Mineral Exploration Tax Credit for five years, to 2024, has the Prospectors and Developers Association of Canada celebrating.
This is the first multi-year renewal since the METC was established in 2000. Each previous renewal was for only a one-year period.
Glenn Mullan, PDAC president
“[The] commitment by the government is a monumental sign of support for the growth of, and investment in, Canada’s mineral exploration sector,” says Glenn Mullan, PDAC president. “The METC is a critical component of our industry that helps to catalyze investment in mineral exploration projects that lead to the discoveries that could become the mines of the future.”
Canadian mining is facing more global competition for mineral exploration financing. The longer renewal of the METC creates more certainty for investors. The flow-through shares at the heart of the program allow tax credits to be passed on to investors. Before 2000, only mining companies were entitled to a tax credit for exploration expenses. The problem was that junior explorers often have no income against which to take a tax credit. Allowing the credit to flow-through to investors has attracted a great deal of interest in mineral exploration in Canada.
The five-year METC agreement provides stability for juniors. They can plan multi-year exploration programs, allowing them the benefit of longer term planning.
Government support for the mineral exploration sector is critical in driving new discoveries that will lead to new mines, says the PDAC. Visit the association at www.PDAC.ca.
MAC weighs in
Ottawa-based the Mining Association of Canada also supports the longer METC renewal, but it notes that it is not the only incentive for the mining industry.
An accelerated investment incentive was introduced. It allows miners to write off three times the eligible cost of newly acquired assets in the year the investment is made.
Businesses are now able to immediately write off the full cost of clean energy equipment. That’s good for all industries not just mining.
Please visit www.Mining.ca.