The Tax Environment
The taxes imposed by any particular
government are crucial to the viability of
a mining project. Too high a tax burden
can make a project uneconomic even
though the project may have excellent
mining fundamentals.
Canada’s system of government
consists of a federal government and
10 provincial governments. Canada
also has three territories, which are
governed by the federal government.
The federal government, the provinces,
and the territories each levy income
taxes on corporations and individuals.
With the exception of Prince Edward
Island (which has no mining activity),
each province and territory also levies
separate mining taxes or royalties on
mining activities. For tax purposes, there
is little distinction between a province
and a territory; consequently, any
reference in this book to an unspecified
province includes a territory.
Table 1: Prices of Gold, Silver, Lead, and Zinc, December 31, 2000, June 30, 2011, and June 30, 2013 (in US dollars)
12/31/2000
6/30/2011
6/30/2013
Unit
Gold
$ 272.25
$ 1,511.40
$ 1,234.53
ounce
Silver
$ 4.60
$ 35.08
$ 19.68
ounce
Lead
$ 470.00
$ 2,681.75
$ 2,057.00
tonne
Zinc
$ 1,025.50
$ 2,293.75
$ 1,822.50
tonne
Sources: Forex; Bloomberg; and London Metal Exchange
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Introduction
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