TORONTO – Northern Development and Mines Minister Michael Gravelle says the Ontario government is not going to increase the mining tax, despite the auditor general’s concern about falling revenues.
Auditor general Bonnie Lysyk says Ontario’s revenue from mining taxes averages less than two per cent of the value of the minerals extracted, and less than one per cent of the value of diamonds that are mined.
Ontario is the largest mineral producer in Canada with about 25 per cent of total national production, but provincial mining revenues from taxes and royalties fell from a high of $236 million in 2008 to just $18.6 million in 2014.
Gravelle says it’s a very challenging time in terms of commodity pricing, and the mining sector is at a low point right now.
And he says companies can spend $750 million to $1 billion before they “extract one piece of metal out of the ground.”
Gravelle says mining companies employ hundreds of well-paid workers in the preparation stage and during operations, and the government doesn’t want to discourage any new investments by hiking taxes.
“All of those things, I think, mitigate in a powerful way to us being very, very cautious about speaking about changing the mining tax or royalties,” he said.
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