Mining industry confident of carve out on federal government’s capital-gains tax changes

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Federal government says it intends to provide more information to ensure Canada’s mining exploration companies can thrive

The Canadian mining industry is optimistic that Ottawa will carve out an exception for the sector around coming changes to the capital-gains tax that it hopes will pre-empt a large drop in financings.up from one half, for gains above $250,000. Owing to a tax quirk associated when selling flow-through shares, the pending changes will deter high-net-worth individuals from investing in the mining sector, according to Pierre Gratton, president of the Mining Association of Canada.

“Clarifications to those questions are forthcoming, and we are in touch with the mining sector,” she said., with leader Pierre Poilievre promising that a government led by him would would create a “Bring it Home Tax Cut.” That’s because a large chunk of money the sector raises is from investors taking advantage of flow-through shares, in conjunction with the mineral exploration tax credit, or METC. Both boost the returns investors gain from investing in junior resource stocks by ultimately reducing their tax bills.

Over the past few months, Mr. Gratton has been urging Ottawa to carve out an exception for the exploration sector around the capital-gains tax changes that will keep high-net-worth investors from fleeing.

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