New Brunswick — Last But Not Least

CIM Bulletin, Vol. 70, No. 787, 1977

R. D. Brown, F.C.A., Price Waterhouse & Co., Toronto, Ontario

Ever since British Columbia started the ball rolling in 1974 with the introduction of its now-defunct Mineral Royalties Act, all Canada's resource-based provinces have significantly altered their mining tax systems. The last resource-based province to abandon its pre-1974. mining tax structure is New Brunswick, which introduced a new mining tax regime in the summer of 1977 to take effect from April 1, 1977. The new structure, which represents the outcome of considerable study and discussions with industry representatives, contains some intriguing concepts which make New Brunswick's new mining tax system unique among the Canadian provinces. UPON AMENDING the New Brunswick Mining Income Tax Act with effect from April 1, 1977, New Brunswick has introduced a two-tier mining tax structure involving a 2% royalty based on a modified net smelter return, plus a 16% levy on net profit. Included in the province's new mining tax system are a few interesting incentives intended to encourage exploration and processing in the province. (The reader is referred to "Tax Notes" in the July 1977 issue of the CIM Bulletin for a summary of the main features of the former mining tax system in New Brunswick. The maximum mining tax rate under that system was 12%.)