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MEDIA ADVISORY
EXTENSION OF MINERAL EXPLORATION TAX CREDIT HAILED BY CANADA’S MINERAL
INDUSTRY
Toronto, May 2, 2006 – The federal government’s plan, announced today in
the budget, to re-introduce the Investment Tax Credit for Exploration [ITCE]
from May 2, 2006, to March 31, 2007, will be welcome news for Canada’s
mineral exploration and development industry and Canadian investors. The
program, known familiarly as ‘super’ flow-through, allows investors a
15% credit on their flow-through share investments in grassroots
exploration. As the federal budget points out, the one-year ‘look-back’
rule will allow funds raised with the benefit of the credit in 2007, for
example, to be spent on eligible exploration activity up to the end of
2008.
Patricia Dillon, president of the Prospectors and Developers Association
of Canada (PDAC), expressed her organization’s satisfaction that the
program had been re-instated. “The ITCE program is a boon to this
country’s exploration industry. Since its introduction six years ago,
the ITCE has helped keep investment in Canada and has provided an
incentive for Canadian investors to put money into one of this country’s
most important resource industries. This is at a time when global
competition for exploration investment is fierce. Indeed, there is a
general consensus that the ITCE has helped Canada capture and maintain
its position as the number one country in the world for mineral
exploration spending.”
The PDAC points out that high and sustained levels of exploration are
required to discover new mineral deposits. These deposits are crucial to
Canada’s ability to replenish its mineral inventories, feed its
smelters, and meet the demands for mineral commodities from the world’s
emerging economies. “The current high commodity prices and the ITCE
program will help us achieve this,” says Dillon, “and at relatively low
cost to the taxpayer. We estimate that the exploration tax incentive to
date has generated $1.4 billion in exploration spending. Most of this
money is spent in Canada’s northern and rural regions. We congratulate
the federal government for its wise decision.”
The Prospectors and Developers Association of Canada is an advocacy
association for prospectors and companies active in the search for and
development of mineral deposits. The association annually hosts the
largest convention of its kind in the world in Toronto. In March 2006,
the event attracted a record 14,500 attendees.
For more information, contact:
MaryAnn Mihychuk,
Director, Regulatory Affairs, PDAC, telephone 416 362 1969, ext. 233. |
