LETTERS TO THE EDITOR — Mining taxes in Saskatchewan

There is no doubt that Manitoba is making a big effort to attract mining investment and your editorial (T.N.M., June 22/92) was timely. In your review of the Manitoba situation, you highlighted the tax holiday for new mines that comes into effect next year and will allow writeoff of capital expenditures before mining taxes take effect. You claim that the changes implemented by Manitoba “will make it even more attractive when compared to British Columbia, Ontario or Saskatchewan.”

Given the huge debt load that Saskatchewan has at present, we cannot compete with Manitoba’s incentive grants but we are more than competitive when it comes to mining taxes. Saskatchewan has had a royalty system for precious and base metals since 1984 which provides for capital expenditure recovery before royalties are paid. As well, up to five years of exploration expenditures can be written off and when royalties are finally due they are based on 12.5% of net profits.

Les Beck

Executive Director

Saskatchewan Energy and Mines

Regina