Critics often claim incorrectly the oil and gas industry is subsidized and they belittle or ignore the jobs and other benefits created by the industry. They also tend to gloss over the fact the world will need all forms of energy – including oil and gas – to meet global energy demand for decades.
Oil and gas companies support about 720,000 jobs in Canada for professionals and skilled trades of all types. Companies contribute about $18 billion a year through income tax, royalty and other payments governments use to help fund programs like education and health care.
In British Columbia, the oil and gas industry has been the single largest source of natural resources revenues in B.C. – greater than mining and forestry combined – over the past decade. The industry invests between $4 billion and $6 billion in B.C. annually and directly employs about 12,000 people.
The corporate income tax rate for oil and gas companies is identical to the rate for other companies. Oil and gas companies deduct capital expenditures and expenses using the same principles, often at comparable rates, as other industries.
Canada competes globally for oil and gas industry investment capital. A sound, competitive fiscal framework must be maintained to provide a level playing field and continue to attract investment to Canada.
Tax expenditure methodology, deduction rules and regional stimulus programs are not subsidies – they are part of that all-important fiscal framework. Let’s make sure taxes and other costs to industry are competitive, and keep it that way.
Contributed to Times Colonist
Manager British Columbia
Canadian Association of Petroleum Producers
May 30, 2015