Trinidad Receives More Corporate Tax From PotashCorp For One Small Nitrogen Plant Than Saskatchewan Does For BILLIONS In Mine Production!
PotashCorp* takes BILLIONS of dollars worth of potash profit out of the ground every year and is paying a couple of measly cents on every dollar of profit. The same PotashCorp has one small nitrogen plant on the island of Trinidad. Quess which jurisdiction receives the most corporate tax? NOT SASKATCHEWAN!
The following article is from Larry Hubich's Blog and features hard financial facts from economist, Erin Weir:
"PotashCorp’s Annual Report: The Fine Print
Posted by Erin Weir under Saskatchewan, corporate income tax, potash.
February 26th, 2011
The Potash Corporation of Saskatchewan posted its 2010 annual report yesterday. It’s always worth taking a closer look at documents released on a Friday afternoon.
Those interested in public revenues should see pages 109, 110 and 111. Note 19’s breakdown of “Provincial Mining and Other Taxes” confirms something that I had suspected.
PotashCorp paid zero Potash Production Tax in 2010. In other words, the company is swimming in writeoffs and had no taxable profits according to Saskatchewan’s profit-tax formula.
The company’s entire $77-million royalty payment in 2010 was the provincial resource surcharge, set at 3% of sales. (Of course, 3% of potash sales is closer to 5% of potash gross margin).
Thank goodness Saskatchewan kept the resource surcharge when it eliminated its corporate capital tax. Otherwise, PotashCorp’s 2010 royalty payment would have been a big goose egg (and not of the golden variety).
Note 21 breaks down corporate income tax by country. While the report does not distinguish between federal and provincial income tax, the 30% “federal and provincial statutory income tax rate” clearly comprises the 18% federal rate plus the 12% Saskatchewan rate.
So, we can infer that PotashCorp’s 2010 Canadian income tax expense of $333 million comprises about $200 million to Ottawa and $133 million to provincial governments. Because the company also operates in other provinces, Saskatchewan is probably getting less than $133 million.
Meanwhile, PotashCorp is paying $113 million of corporate income tax in Trinidad, where it has a nitrogen facility. In the previous year, 2009, it actually paid more corporate tax to Trinidad than to all levels of Canadian government!
Congratulations, Trinidad, for collecting a decent amount of revenue from PotashCorp. Canada’s federal and provincial authorities need to pull up their socks."
Larry Hubich's blog
* PotashCorp was formerly the Potash Corporation of Saskatchewan, a Crown Corporation owned by the people of Saskatchwan that was privatized by the Devine Conservative government - that is who Brad Wall worked for before he was elected to the Sask Legislature.
-Brad Wall is literally 'giving away' Saskatchewan's Potash wealth ...
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