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  • CCPA in Europe for CETA speaking tour October 17, 2017
    On September 21, Canada and the European Union announced that the Comprehensive Economic and Trade Agreement (CETA), a controversial NAFTA-plus free trade deal initiated by the Harper government and signed by Prime Minister Trudeau in 2016, was now provisionally in force. In Europe, however, more than 20 countries have yet to officially ratify the deal, […]
    Canadian Centre for Policy Alternatives
  • Twelve year study of an inner-city neighbourhood October 12, 2017
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    Canadian Centre for Policy Alternatives
  • Losing your ID - even harder to recover when you have limited resources! October 10, 2017
    Ellen Smirl researched the barriers experienced by low-income Manitobans when faced with trying to replace lost, stolen, or never aquired idenfication forms. Read full report here.  
    Canadian Centre for Policy Alternatives
  • CCPA recommendations for a better North American trade model October 6, 2017
    The all-party House of Commons trade committee is consulting Canadians on their priorities for bilateral and trilateral North American trade in light of the current renegotiation of NAFTA. In the CCPA’s submission to this process, Scott Sinclair, Stuart Trew, and Hadrian Mertins-Kirkwood argue for a different kind of trading relationship that is inclusive, transformative, and […]
    Canadian Centre for Policy Alternatives
  • Ontario’s fair wage policy needs to be refreshed September 28, 2017
    The Ontario government is consulting on ways to modernize the province’s fair wage policy, which sets standards for wages and working conditions for government contract workers such as building cleaners, security guards, building trades and construction workers. The fair wage policy hasn’t been updated since 1995, but the labour market has changed dramatically since then. […]
    Canadian Centre for Policy Alternatives
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Sask Party Shills for PotashCorp

Yesterday’s strong earnings report from the Potash Corporation of Saskatchewan confirms what this blog and the NDP have been contending: even modestly increasing Saskatchewan’s extremely low royalties on hugely profitable potash mines could fund substantially better provincial public services.

The Saskatchewan Party still refuses to review potash royalties. In a well-timed column, Greg Fingas developed the theme that this gift to potash companies is the provincial election’s most expensive promise.

The Sask Party issued a carefully-worded press release implying that PotashCorp invested $590 million in Saskatchewan and paid nearly $332 million to the provincial government in the third quarter of 2011. Both suggestions are misleading.

While some commentators wrote that PotashCorp reinvested $590 million in Saskatchewan, the Sask Party itself stopped short of making that claim since this figure is a worldwide total. The company reports only that “the majority of the $590 million in capital expenditures” were in potash rather than nitrogen or phosphate.

The Sask Party compares this figure to $700 million of potash gross margin, at least 90% of which is from Saskatchewan as opposed to New Brunswick. If two-thirds of PotashCorp’s investment was in Saskatchewan potash mines, it reinvested something like 63% of its gross margin (i.e. $590*0.67/($700*0.9)), a far cry from the 84% put forward by the Sask Party. In contrast, 100% of every dollar in additional royalties would be reinvested in the province.

The Sask Party went on to claim, “PotashCorp paid another $332 million in potash royalties and income taxes in the third quarter – the vast majority of which would have been paid in Saskatchewan.” This figure is the sum of “provincial mining and other taxes” ($53 million) and “income taxes” ($279 million). The $53 million is Saskatchewan’s potash production tax and resource surcharge.

The $279 million is worldwide corporate income tax, more of which goes to the Canadian federal government than to provincial governments. (Note that the Sask Party wrote “paid in Saskatchewan” not “paid to Saskatchewan.”)

PotashCorp has confirmed that it paid only $82 million of corporate tax to the Saskatchewan government throughout 2010, less than it paid to Trinidad. Saskatchewan people should get a better return.

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