Quebec mining duties reform

CIM Bulletin, Vol. 88, No. 986, 1995

Robert B. Parsons, Partner, Price Waterhouse, Toronto

The 1994 Quebec Budget included a significant overhaul of the mining duties system in that province: broadening the base and lowering the rate, all in the name of "ensuring the integrity of the taxation system" and "enabling the State to collect fair compensation ". The reforms hit hardest on the small, lightly-capitalized producer, by repealing the basic annual exemption, limiting the refund for losses, and significantly reducing the investment and processing allowances. There is some relief provided in the form of faster depreciation rates and a lower nominal tax rate, but the thrust of the overhaul is clear - higher taxes on the mining sector.