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  • Rental Wage in Canada July 18, 2019
    Our new report maps rental affordability in neighbourhoods across Canada by calculating the “rental wage,” which is the hourly wage needed to afford an average apartment without spending more than 30% of one’s earnings.  Across all of Canada, the average wage needed to afford a two-bedroom apartment is $22.40/h, or $20.20/h for an average one […]
    Canadian Centre for Policy Alternatives
  • Towards Justice: Tackling Indigenous Child Poverty in Canada July 9, 2019
    CCPA senior economist David Macdonald co-authored a new report, Towards Justice: Tackling Indigenous Child Poverty in Canada­—released by Upstream Institute in partnership with the Assembly of First Nations (AFN) and the Canadian Centre for Policy Alternatives (CCPA)—tracks child poverty rates using Census 2006, the 2011 National Household Survey and Census 2016. The report is available for […]
    Canadian Centre for Policy Alternatives
  • Fossil-Power Top 50 launched July 3, 2019
    What do Suncor, Encana, the Royal Bank of Canada, the Fraser Institute and 46 other companies and organizations have in common? They are among the entities that make up the most influential fossil fuel industry players in Canada. Today, the Corporate Mapping Project (CMP) is drawing attention to these powerful corporations and organizations with the […]
    Canadian Centre for Policy Alternatives
  • Tickets available for Errol Black Chair Fundraising Brunch 2019 June 26, 2019
    You are invited to CCPA-MB’s annual fundraising brunch in support of the Errol Black Chair in Labour Issues.  Please join us to honour: Honoured Guest: John Loxley is Professor of Economics at the University of Manitoba and a Fellow of the Royal Society of Canada. Guest Speaker:  Jim Stanford is Economist and Director of the Centre […]
    Canadian Centre for Policy Alternatives
  • The fight against ISDS in Romania June 24, 2019
    CCPA is proud to co-sponsor this terrific video from our colleagues at Corporate Europe Observatory. It chronicles grassroots resistance to efforts by Canadian mining company Gabriel Resources to build Europe’s largest open-pit gold mine in a culturally rich and environmentally sensitive region of Romania. After this unimaginably destructive project was refused by the Romanian public and courts, the […]
    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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