Sunday, September 24, 2006

About Time

This is news in Texas.

Alberta scraps royalty tax credit after 3 decades

- The Alberta government eliminated the Alberta Royalty Tax Credit on Thursday in a move that Energy Minister Greg Melchin said would add $111 million a year to government coffers when it comes into effect on Jan. 1.

The tax credit is one of the last vestiges of the Alberta-Ottawa energy wars of the 1970s, enacted in 1974 to counter a move by the federal government to eliminate tax deductions for royalties paid by oil and gas companies.

Leach suggested that the credit fell victim to politics. All the major candidates in Alberta's Tory leadership race advocate steps to increase the province's share of resource revenues, which amounted to $14 billion in the last fiscal year."We think it's responding to uninformed criticism of Alberta's royalty regime," he added.

Thursday's decision received unqualified support from an unlikely source --provincial NDP leader Brian Mason.

"We are very pleased that the government has finally been forced to cancel this corporate giveaway," he said. "The end of this program means a victory for Albertans."

Now lets adjust that pitiful 1% royalty we get paid for the people of Albertas resources namely the Tar Sands.

Yes it is a sop to the complaints raised about the fact we have the lowest royalty rate in the world. I like the guy who says we are uninformed....we are well informed that we are being ripped off.

First, contrary to popular belief, the Alberta government derives much more in royalties from natural gas than it does from oil. In 2004-05, it received $9.7 billion in resource revenues. Of this, $6.4 billion was from natural gas royalties, $2.0 billion was from oil royalties, andthe remainder was from other sources such as land sales. BMO Report January 2006 Alberta’s Long-range Outlook: “Oil’s Well”

Heck Newfoundland has a higher royalty rate than we do for all that Tar Sands oil.

And lets not forget that the Alberta Advantage did not begin under Ralph but under Lougheed,and it was created by OPEC and the oil boom of the seventies. Yet the Lougheed government still gave out corporate welfare. Without both Federal and provincial state capitalism the Tar Sands would never have been developed.


Oil Royalties

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