Federal budget good news for city, so so for mines

The new federal budget is good news for Whitehorse and a bit of a toss-up for Yukon's mining companies.

The new federal budget is good news for Whitehorse and a bit of a toss-up for Yukon’s mining companies.

The preservation of the gas tax fund is a big relief for Yukon’s municipalities because it makes up a big portion of their budgets. The federal government committed to protecting the gas tax fund in the 2012 budget, and this year they’ve decided to peg it permanently to the rate of inflation.

That means municipalities now know the funding is safe, and they have a much better idea of how much they’ll get each year.

“It’s good news that the federal government is providing two things: ongoing funding of existing programs, and that level of certainty to focus their planning efforts,” said Whitehorse’s director of corporate services, Robert Fendrick.

“It’s very exciting for us, and good for the local taxpayer. The other options would be to build up taxes, but whenever we get external funding, we don’t have to do that as much,” said Fendrick.

The money from the gas tax fund could be used to bolster other funding like the Build Canada Fund, or to help bail out Mt. Sima.

“It would allow possible freeing up of funds for recreational facilities. The immediate plan for Sima is to work with council to discuss what our options are going forward. There’s no real direct tie and this point, though it is an allowable use,” Fendrick said.

On the industry side, things aren’t quite so rosy.

“It’s a bit of a mixed bag,” said Mike Kokiw, executive director of the Yukon Chamber of Mines. “There is the continuation of the mineral exploration tax credit for flow-through shares for investors. Basically what that means is there are certain expenses that are tax deductible on behalf of the company or mining organization. By selling those shares, they pass that tax benefit on to the shareholder, or the investor. That investor is now able to use that tax credit.”

But two important tax credits for the mining sector are being scaled back, Kokiw explained.

The first is the accelerated cost of capital allowance, which gives companies breaks on the costs of manufacturing. It will be phased out by 2020.

“While it doesn’t have much of an impact right now, it does affect companies that are in that pre-feasibility phase. It will affect some of their tax benefits, basically,” Kokiw said.

“And the one that’s really pretty drastic is the Canadian exploration expense. That’s the one that could have an impact on the Yukon,” he said.

The exploration expense helps with the costs of building new mines and sinking mine shafts. Its loss could have an impact on future mines like Victoria Gold Corp.‘s Eagle project and North American Tungsten’s Mactung project.

“Basically, it allows expenses for removing overburden or sinking mine shafts, all the kinds of expenses associated with pre-production mines, and that’s where a lot of our stuff falls. It was 100-per-cent deductible before, and it’s now moving to 30-per-cent deductible. Some of those changes could have an impact on companies that are starting construction in the next year or two,” said Kokiw.

Kokiw was also optimistic about the federal government’s focus on developing a stronger skilled labour workforce, and the promise to help fund Yukon College’s mine training programs.

Contact Jesse Winter at


Just Posted

Super finish to Super Hoops

“So to finally win, especially in my senior year, feels amazing”

Turn that frown upside down: New radar monitors drivers’ speed

The sign, complete with emojis to tell you how you’re doing, will move between 10 locations in Whitehorse

Canadian justice system can benefit from Indigenous practices, MMIWG chief commissioner says

The Canadian justice system would benefit from learning about and adopting Indigenous… Continue reading

Below-average salmon season forecasted for transboundary rivers

Fisheries and Oceans Canada has forecasted a largely below-average season for salmon… Continue reading

Yukon government discontinues lawsuit over Dawson wastewater treatment plant

A government lawyer filed a notice of discontinuance to Yukon Supreme Court Feb. 19.

Dwayne De Rosario inspires Yukon futsal teams ahead of Arctic Winter Games

The soccer great was in Whitehorse for two days of futsal sessions with local players

History Hunter: Yukoners honoured for their contributions to Yukon history

The Yukon Historical and Museums Association handed out the 36th Annual Yukon Heritage Awards

Yukonomist: Whitehorse through the eyes of an app

You probably don’t use an app to decide where to dine out… Continue reading

Today’s mailbox: free transit

Letters to the editor published Feb. 26

Local skiers compete in 2020 Yukon Cross Country Ski Championships

The event included dozens of racers competing in mass-start skate races

Tr’ondëk Hwëch’in to hold general election in April

On top of voting for chief, three councillors, citizens will vote for a deputy chief for first time

Yukon’s minimum wage set to increase by $1 to $13.71 in April

The increase will make the Yukon’s minimum wage the fourth-highest in the country

City news, briefly

Some of the decisions made at the Whitehorse council meeting on Feb 17

Most Read