Tax concerns persist

"Concerns over possible additional involvement of governments in Canada's mining industry and its adverse effects on the industry 's growth were a frequent topic of conversation at the recent Annual General Meeting of the CIM.Still painfully fresh in the minds of industry leaders are the disastrous results of the federal/provincial scramble over resource revenues which followed the relatively high metal prices witnessed in 1973/1974. At current metal prices, it is not surprising, then, that a nagging fear persists that these governments may once again restructure tax and other rules to the detriment of the industry and the country.This month, Tax Notes recalls some of the progress which the industry and governments have made in 1979 in the taxation of the resource sector, and urges that higher metal prices be viewed in light of the costly exploration, development and production efforts which will be required for the industry to continue to play its important role in our economy.IntroductionAt the Annual General Meeting of The Canadian Institute of Mining and Metallurgy, held in April, 1980, it was abundantly clear that there is widespread concern in Canada's mining industry that this country's tax regime may once again be blasted by ill winds of change.A stable and more favourable tax climate, as well as higher metal prices and profits, made 1979 almost a golden year for Canadian mining. However, from the tax viewpoint at least, there are some spots on the silver lining as apprehensions grow that the well-heralded battle between federal and provincial governments over oil and gas may spread to the mining sector, with serious damage to the industry and its newfound federal-provincial cooperation."