Mining Association of BC Comments on Budget 2018

February 20, 2018

VICTORIA, BC – MABC acknowledges the government’s commitment in Budget 2018 to begin to address the competitiveness challenge of BC’s mining sector created by the carbon tax through the creation of a new incentive and investment program.  This program will be funded by the carbon tax increases in excess of the current $30 per tonne tax.

While BC’s carbon tax has provided a price signal to incentivize emissions reductions over the last 10 years, it has also increased the cost of production for the BC mining industry. None of British Columbia’s global mining competitors pay a comparably stringent carbon price, if any carbon price at all. BC’s mining companies sell their products on world markets, at globally established prices, and therefore are unable to pass on additional costs. BC mines must also directly absorb the carbon tax costs passed on by other sectors providing service to the industry. The carbon tax has been a competitiveness challenge for BC’s mining industry since its inception.

B.C.’s mining industry can play a critical role in contributing to Canada’s transition to a lower-carbon economy by contributing to the additional copper needed for electric cars compared to conventional cars, and to the steelmaking coal required to build public transit infrastructure and wind turbines. While the mining industry appreciates the commitment to address the competitiveness challenge created by the carbon tax above $30 per tonne, in order for BC’s mining industry to truly be competitive, program design needs to include the entire amount of carbon tax paid by industry.

An additional competitiveness concern to the mining industry in Budget 2018 is the implementation of a new employer health tax that will increase the operating expense of BC mining companies, beginning in 2019.  This new tax creates revenue for government in excess of what has previously been paid by many employers on behalf of their employees for Medical Services Plan (MSP) premiums. Of particular concern is that many employers will pay both MSP premiums and the new employer health tax during calendar 2019.

“We acknowledge the government’s commitment to begin address the competitiveness of BC’s mining industry with the creation of a clean growth incentive and investment program, and look forward to working with the government and other stakeholders on the program’s design,”  said Bryan Cox, President & CEO of MABC. “A strong and thriving BC mining industry can continue to play a pivotal leadership role in Canada’s clean tech future, for the benefit of BC’s families and workers, but only if the competitiveness of the industry in British Columbia is fully addressed, including ensuring a competitive tax and regulatory system.”

The Mining Association of British Columbia (MABC) is the voice of mining in BC, representing operating coal, metal and industrial mineral producers in the province. Our mandate is to support a strong and thriving mining industry that creates opportunities and wealth for all British Columbians. In 2016, the mining industry in BC contributed $8.7 billion to the BC economy and $650 million in direct payments to government, and 30,000 jobs through direct and indirect employment.