(File photo/CKOM News Staff)

By CKOM News

Province expanding access to potash industry tax credits

Dec 7, 2020 | 10:57 AM

The provincial government is hoping upgrades to some tax incentives will encourage potash companies to try new things.

The Government of Saskatchewan has announced changes to the tax regulations governing the potash sector. The changes are meant to improve access to a tax credit that covers 40 per cent of costs for new research and development projects and “approved market development programs.”

The province is hoping to inspire junior potash companies to turn towards innovation by removing expiry dates and enhancing the eligibility requirements for the tax break.

“These changes will promote the expansion of Saskatchewan’s potash sector and ensure that our province remains the preferred jurisdiction in which to pilot innovative technologies,” Bronwyn Eyre, the minister for energy and resources, said in a media release. “As we move into economic recovery, we want to attract and foster new, sustainable advancements in our province’s world-class resource sector.”

To qualify for the credit, research and development projects have to showcase improved efficiency in potash production, mitigation of environmental impacts, reduction in physical risks to employees and mine operations, or the development of new and improved potash products. The market development credits will be granted to companies that create new markets or grow existing ones.

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“We are very pleased to see clear leadership with respect to the amendments to the Saskatchewan Potash Production Tax Regulations,” Gensource Potash Corp. president and CEO Mike Ferguson said in the release.

“The amended regulations dovetail with the leadership in innovation that Gensource is deploying at its Tugaske project. Gensource welcomes the amendments to the regulations and look forward to providing long-term economic benefit to the Saskatchewan community while demonstrating real-world ESG (environmental, social, and governance) leadership.”

According to the province, the potash industry in Saskatchewan is responsible for about 30 per cent of the world’s potash production. It also employs around 5,000 people.