Alberta’s tax regime ‘hurting the golden goose’

Alberta’s tax regime ‘hurting the golden goose’

CALGARY Oil and gas companies operating in Alberta not only face the highest royalty rates in the country, but also pay more taxes and royalties compared with other industries such as manufacturing, forestry and construction, according to a study on Canada’s competitiveness released Wednesday.British Columbia and Saskatchewan also place a heavier tax and royalty burden on the energy industry compared with other sectors, according to Jack Mintz, an influential tax expert and economist, and his colleague Duanjie Chen at The School of Public Policy at the University of Calgary.”The playing field isn’t level, and as a result we’re getting less capital allocated to oil and gas projects compared to other industries,” Mr. Mintz said in an interview. “It discourages investment in the oil and gas industry, so you’re hurting your golden goose.”The fiscal burden foisted on conventional oil and gas projects in Alberta in 2012 will be almost double that placed on other industries.canada goose coats The tax burden on oil and gas companies in British Columbia and Saskatchewan will be higher by about a quarter compared to other sectors, the report said.To help solve the problem, Mr. Mintz recommended a simple royalty system similar to the one applied to oil sands companies prior to 2009. Provinces should take a percentage of revenue after deducting all costs. The structure mirrors the one used in Australia and British Columbia for mining companies.Alberta, which is expected to soon overhaul its oil and gas royalty framework, save for the oil sands system, to make the province more attractive has already ruled out Mr. Mintz’s suggestion.”We’re not looking at replacing the [royalty] framework with an oil sands type of regime for conventional oil and gas,” Bob McManus, a spokesperson for Alberta’s energy department, said. “We’ll be working within the existing framework but certainly we recognize that there may well need to be changes.”The Canadian Association of Petroleum Producers does not have a preferred policy, and cares only that Alberta gets more in line with other jurisdictions.”Our overall position is that we need to be competitive and open to exploring ways to do that,” Greg Stringham, vice president of markets and oil sands at the lobby organization, said. “If there is some way that can be done in a simple manner that is clear to investors and results in employment coming back into Alberta, that’s what we want to get to.”Mr. Mintz said he shared his preliminary findings with an official working on Alberta’s competitive review, Alberta’s department of finance, and the department of finance in Ottawa. His analysis considered all levels of tax, including sales tax, corporate income tax and sliding royalty rates.A lower overall tax and royalty rate for the energy industry could translate into more revenue for Alberta, Saskatchewan, and British Columbia, because companies could invest more cash and therefore extract more resources, which would give the provinces more royalties.Nova Scotia and Newfoundland and Labrador were the exceptions to the study’s findings. Mr. Mintz’s report found their tax and royalty rates, combined with the federal Atlantic investment tax credit, are so low they translate into subsidies.No medals for sexism in Olympic sports commentaryReflecting on the Rio Summer Olympics that just wrapped up, we discovered a satirical spectator sport for those of us frustrated by the nightly highlight reels belittling female athletes: media sexism bingo. Steph Leclair mind races as she holds the knife mid air, eyeing the sugar cane that jams up her grinder. “

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