Alberta: Slashing tax incentives for oil exploration devastating to our province
OTTAWA – John Barlow, Member of Parliament for Foothills, issued the following statement following the tabling of Budget 2017:
“I am deeply concerned about the effect Budget 2017 will have on the families and businesses of Foothills. This budget also negatively impacts the Canadian agriculture and energy sectors. This was supposed to be a government committed to helping the middle class, but slashing tax incentives in our natural resource and agriculture industries will devastate these sectors – sectors that provide good-paying jobs for Alberta’s middle class. Trudeau said he would phase out Canada’s energy sector, and removing incentives for junior companies to invest in new energy discoveries is another Liberal government attack on Alberta’s energy sector – the economic engine of this country.”
MP Barlow is not alone in raising concerns about the impact eliminating these programs will have on Alberta’s energy sector.
“I am disappointed and I think it sends a bad signal and further puts us at a disadvantage in terms of the capital we are trying to attract from global markets, compared to the United States, which is our biggest competitor for that capital,” said Tim McMillan, president and CEO of the Canadian Association of Petroleum Producers.
“The U.S. is going in a completely different direction on carbon and major U.S. Tax reform. That’s in addition to the measures being taken on carbon in Alberta. You start adding it all up and it is not a healthy climate. Businesses are taking their money elsewhere,” said Jack Mintz, School of Public Policy at the University of Calgary.
Barlow made note of several features of the Budget which will negatively affect the residents of Foothills, including:
- Increasing the deficit from $23 billion to $29 billion in 2017-2018, with no plan to balance the budget until 2055. Liberal debt will accumulate to more than $1.5 trillion by 2045;
- Eliminating the Canadian Exploration Expense program for oil and gas discovery wells;
- Carbon tax will cost agriculture producers $10-$15 per acre and will increase. This will cost a 3,000-acre farm $30,000 to $50,000 per year;
- Threatening to eliminate the tax deferral on cash purchase tickets for grain farmers;
- Excise taxes on beer, wine, and spirits increased 2%;
- Removal of the public transit tax credit;
- Deferring $8.5 billion in equipment purchases for our Canadian military by more than 20 years.
Liberal programs won’t help the vast majority of Canadian workers and businesses, including the energy and agriculture sectors now facing more intense competition from a low-cost, low-tax, United States. In Budget 2017, the Liberals decided now was the time to alter the tax treatment of exploration wells, making Canada’s energy sector even less competitive relative to other jurisdictions. This means that businesses, investment and jobs will be going elsewhere.
“Instead of raising taxes on Canadian families and businesses, Justin Trudeau should focus on supporting policies that will create jobs and grow the economy,” said MP Barlow.