Measure intended to offset cost-intensive exploration activities.
Canada plans to extend tax credits for critical mineral exploration activities for two more years, according to a government statement. Originally set to expire at the end of March, the program helps Canadian companies, particularly juniors, raise capital by issuing flow-through shares. These shares allow investors to deduct them from their taxable income, making them a key incentive for investment. Widely used in Canada’s natural resources sector, they support cost-intensive exploration and mining activities. It can take years, or even decades, before a mine begins generating revenue for a company. The process—from exploration and development to final construction—is lengthy and capital-intensive, requiring significant investment long before any returns are realized.
Extending the program by two more years is expected to inject approximately $76 million (CAD$110 million) into the sector, according to the statement. Canadian Minister of Energy and Natural Resources Jonathan Wilkinson stated that the extension “reaffirms Canada’s commitment to strengthening this vital sector.” The move aligns with Canada’s Critical Minerals Strategy, with which the North American country seeks to position itself as an alternative raw materials supplier to industry leader China. Key initiatives that have already been announced include accelerating permitting processes and developing essential infrastructure, such as roads, railways, and electricity networks.
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