Introduction

Canada’s Mining Industry

For over a decade, mining has been one 
of Canada’s fastest-growing sectors. The 
mining industry is vital to the country’s 
economic well-being.

Canada has traditionally been a world 
leader in the mining industry. Currently, 
it is a leader in the production of potash, 
uranium, nickel, and cobalt. Canadians, 
largely through the TSX and TSX-V, have 
also been leaders in the financing of 
mining projects throughout the world. 
A significant portion of the equity funds 
raised for worldwide mining activities 
has been raised in Canada. 

The first decade of this century saw 
an explosion of activity in the mining 
industry throughout the world. This 

explosion was fuelled by a dramatic 
increase in the prices of precious and 
base metals. In the two years since the 
first edition of this work was published, 
participants in the mining industry have 
had to deal with the retreat of metal 
prices from their highs. The prices of 
gold, silver, lead, and zinc on December 
31, 2000, June 30, 2011, and June 30, 
2013 are set out in Table 1. 

However, analysts believe it is very likely 
that the demand for metals will continue 
to grow with further industrialization 
in developing countries. This increased 
demand will result in even greater 
interest in mining activities in Canada.

In addition, more recently, mining 
corporations have seen their costs 
increase faster than metal prices. This 
has had a negative short-term impact 
on the share prices of many mining 
corporations. We are optimistic that the 
mining corporations will be successful in 
taking the necessary steps to deal with 
the escalation of costs. As a result, we 
continue to see a very bright future for 
the mining industry in Canada.

Finally, Canada and its provinces have 
increased their share of mining tax 
revenues in the last two years. However, 
the tax regime in Canada is still a very 
favourable one for the mining industry.

© 2013 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms 
affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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 A Guide to Canadian Mining Taxation