Angry GNWT Premier Hints At New Taxes For Diamond Mines
May 08, 04Canadian mining companies and their professional associations have published a report charging that policies to encourage diamonds mined in Canada's northern regions to be cut and polished domestically may create an unsustainable industry that discourages new mines and doesn't benefit Canadians. The report has led to furious reactions from both the Northwest Territories (NWT) government as well as from industry sources.
A large part of the miner’s report urges the government to grant tax breaks and incentives to exploration and mining companies. However, when it comes to “secondary industry”, which brings important additional added value to the regional economy, the mines speak out against any form of subsidies or government incentives. The mines are forgetting that mineral resources are not private property, sighs one frustrated official, adding that “this is like demanding from government to give a lot, but then refusing to give anything in return.”
The Premier of the GNWT, Joe Handley, didn’t mince words in talks with newspapers. "We entered into agreements with diamond companies to have their support in setting up a cutting and polishing industry in lieu of us levying some sort of tax. If the diamond industry does not want to participate with us in supporting the diamond polishing sector and the jewelry industry, where the real profit is, then it's time for us to sit down and talk."
The report represents a position paper of all mining companies and does not specifically refer to companies that are already operating in the Northwest Territories. After IDEX went online last Friday with the story, one of the operating mines pointed out to us that its commitment to secondary industry is solidly enshrined in written agreements and is already being implemented. It was pointed out that some of the specific references which were made in our initial story are not fully applicable to specific situations and that the resulting article wasn’t as balanced as is always expected of this column.
We will follow up on this issue in a later article making a clear distinction between the policies of the operating mines and the general policies statement of the mining community.