In March, the Government of Nunavut (GN) departments of economic development and transportation and finance announced that the fuel tax rebate program should be cancelled once a mine becomes operational. The GN collects fuel taxes from companies to reinvest into infrastructure and programs in the territory.
The fuel rebate program gives mining companies, and others, a break on the amount they are obliged to pay in fuel tax. Development partnership agreements, which detail what Nunavut gets out of the deal, such as jobs and investment, must be signed before a company can qualify for the tax rebate. To be eligible for the rebate, a company or individual must be involved in harvesting, outfitting, quarrying for carving stone, mineral exploration or mining development, extraction or reclamation.
The departments will still allow mining companies to get a fuel tax rebate during the exploration and development stage of their projects and are now working on developing a replacement for the development partnership agreement.
The rebate could still be helpful in enticing junior mining companies to the territory by offsetting the huge cost of launching mineral exploration programs in the arctic.