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The Mining Tax Act
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This version is current as of June 22, 2017.
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C.C.S.M. c. M195

The Mining Tax Act

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

Definitions

1(1)        In this Act

"advanced exploration project" means

(a) excavation of an exploration shaft, adit or decline,

(b) construction of an all-weather access road to an advanced exploration site, or

(c) diversion, alteration or damming of a natural watercourse for purposes of bulk sampling, mine development or mining,

and such other project or class of project that is prescribed by regulation under The Mines and Minerals Act as an advanced exploration project; (« ouvrage d'exploration avancée »)

"book value" where used to refer to the book value of an asset, means the original cost of that asset less all depreciation charged to that asset as shown in the books of the owner of the asset for the purposes of preparing financial statements for the shareholders of the company up to the end of the fiscal year immediately preceding the fiscal year in which the book value of the asset is material; (« valeur comptable »)

"closure plan" means a plan that sets out a program for protection of the environment during the life of a project, and for rehabilitation of the project site upon closing of the project, and that includes the provision of security to the Crown for performance of rehabilitation work; (« plan de fermeture »)

"dealing at arm's length" has the meaning that that expression has in the Income Tax Act (Canada); (« traiter sans lien de dépendance »)

"depreciable assets" where used to refer to the depreciable assets of an operator means the assets within Manitoba of the operator resulting from

(a) the preproduction expenses incurred by the operator in respect of a mine, whether or not that mine is placed in production, placed in an available for use basis, or abandoned,

(b) the aggregate expenditures, not including any interest charges, made by the operator for the purchase and installation within Manitoba of mining buildings and equipment, whether or not the buildings and equipment are placed in production, placed in an available for use basis, or abandoned,

(c) the aggregate expenditures, not including interest charges, made by the operator for the purchase and installation within Manitoba of milling, smelting and refining buildings and equipment therein, whether or not the buildings and equipment are placed in production, placed in an available for use basis or abandoned, and

(d) all other expenditures, not including interest charges,

(i) that have been made by the operator,

(ii) that, in the opinion of the director, were made for a necessary part of the mineral processing establishment which is of a permanent nature and necessary to the continuing operation of the mineral processing establishment, and

(iii) that are shown in the books of the company as capital expenditures for the purposes of preparing financial statements for the shareholders of the operator,

but does not include any assets resulting from expenditures made for the purchase or acquisition of mining properties from another person, or in obtaining an option to purchase or acquire mining properties from another person, or any assets resulting from expenditures that were part of deductible expenses for the purposes of calculating profit under this Act or The Mining Royalty and Tax Act; (« éléments d'actif amortissables »)

"director" means the Deputy Minister of Finance or any assistant deputy minister of Finance; (« directeur »)

"exploration expenses" where used to refer to the exploration expenses incurred by an operator means expenses incurred by the operator for actual exploration for new mineral occurrences in the province but not including

(a) moneys expended to obtain mineral rights, mining claims or mining leases or any interest or estate therein, or to obtain any share or security of a company having mineral rights, mining claims or mining leases or any interest therein, or

(b) expenses incurred in acquiring a depreciable asset, or

(c) expenses incurred for pre-production expenses; (« frais d'exploration »)

"fiscal year" means the period, which in no case may exceed 12 months, for which the accounts and financial statements of an operator are regularly prepared, and includes a short fiscal year; (« exercice »)

"mine", when used as a noun, means

(a) any opening or excavation in, or working of the ground for the purpose of winning any mineral bearing substances, and

(b) all ways, works, engine, machinery, plant, buildings, and premises, below or above ground belonging to, or used in connection with, the operation of mining,

but does not include any processing buildings or equipment; (« mine »)

"mine", when used as a verb or in a verbal sense means the working of, disturbing, removing, washing, sifting, crushing, or otherwise dealing with, by any mode or method whatsoever, any soil, earth, rocks, stone or quartz, in the process of obtaining any mineral bearing substance therefrom, whether it has been previously disturbed or not, but does not include processing; (« exploiter »)

"mineral" means a mineral as defined in The Mines and Minerals Act but does not include

(a) oil or gas, or

(b) clay, or

(c) gypsum, or

(d) clay products, or

(e) sand or gravel, or

(f) rock or stone used or intended to be used as rock or stone in building or construction, or

(g) peat, or

(h) salt; (« minéral »)

"mineral processing establishment" means the mines, concentrators, smelters, refineries, crystallizers, and associated equipment and buildings, within Manitoba, which constitute the depreciable assets of an operator used for the mining, milling, smelting and refining of mineral products; (« installation de traitement du minéral »)

"mineral product" means a product derived from mineral bearing substances processed in a mineral processing establishment of an operator including those mined, milled, smelted, refined, recrystallized or otherwise beneficiated to a state suitable for

(a) sale to a person with whom the operator is dealing at arms length for further processing, or

(b) fabrication by manufacturing, or

(c) acceptance by the Royal Canadian Mint; (« produit minéral »)

"minister" means the member of the Executive Council charged by the Lieutenant Governor in Council with the administration of this Act; (« ministre »)

"new investment credit" where used in referring to the new investment credit of an operator, means the amount calculated in respect of the operator in accordance with Formula 1 or 1.1 set out in the Schedule; (« crédit aux nouveaux investissements »)

"new mine" means

(a) a mine

(i) that commences production after January 1, 1993,

(ii) that is separate and distinct geologically from any other mine or ore body as determined by the director, and

(iii) that has no common workings or mining operations with any other mine,

but does not include, as determined by the director,

(iv) a formerly operated mine, or

(v) a mineral deposit where advanced exploration, or development as defined in The Mines and Minerals Act, takes place on the project site prior to March 11, 1992; or

(b) where a mine does not qualify under clause (a), a mine that is declared by the Lieutenant Governor in Council to be a new mine under subsection 4.2(3); (« nouvelle mine »)

"new mine tax holiday" means a program that exempts new mines from tax under this Act as set out in section 4.1; (« exonération fiscale temporaire pour nouvelle mine »)

"new mine tax holiday period" means the period during which a new mine is eligible for the new mine tax holiday as determined under subsections 4.1(2) and (3); (« période de l'exonération fiscale temporaire pour nouvelle mine »)

"operator", in relation to a mineral processing establishment, means

(a) the owner, lessee, tenant, holder or other occupier of the depreciable assets that constitute or form part of the mineral processing establishment, and

(b) a trustee in bankruptcy, assignee, liquidator, receiver, receiver-manager, administrator or other person administering, managing, winding-up, controlling or otherwise dealing with the property or business of an operator described in clause (a);

but does not include a person who does not participate in the actual operation of the mineral processing establishment if

(c) the person merely receives a royalty or rent from a person who actually operates and manages the mineral processing establishment,

(d) the person owns the mineral processing establishment, or a part of it, and the establishment is the subject of a lease, grant or licence to another person for the actual operation of it, or

(e) the person owns merely the soil or surface rights of land and has no right or title to the mines or minerals on or under the land; (« exploitant »)

"output" means the minerals and mineral products taken or gained from a mineral processing establishment; (« production »)

"person" includes a partnership, a trust and the Crown in right of Manitoba; (« personne »)

"preproduction expenses" means the aggregate expenses and allowances of the kind described in sections 7 to 12, not including any interest charges, incurred by the operator of a mineral processing establishment in the development in Manitoba of an ore body from the date of acquiring the mine that forms part of the mineral processing establishment to the date production, in reasonable commercial quantities, from the mine begins, and that are essential to the production of the output of the mine; (« dépenses engagées avant la production »)

"processing" means all forms of crushing, grinding, floatation, roasting, smelting, leaching, recrystallizing and refining performed in a mill, smelter or refinery for the purpose of recovering mineral products from mineral bearing substances; (« traitement »)

"processing asset" means any depreciable asset of an operator that is a building or part of a building in which only milling, smelting, recrystallizing and refining activities of the operator take place and all equipment within the building that is used solely for milling, smelting, recrystallizing and refining activities of the operator and, except where the processing plant of the operator is not in operation, includes that depreciable asset whether or not the building or part thereof or the equipment are in production, placed in an available for use basis or abandoned and also includes, in the case of an open pit mine, a primary crusher if it is located beyond the lip of the open pit but does not include any of those depreciable assets that are in or associated solely with a processing plant of the operator that is not in operation; (« élément d'actif servant au traitement »)

"profit" where used to refer to the profit of an operator in a fiscal year, means the profit of that operator in that fiscal year as calculated under sections 4 to 12; (« profit »)

"progressive rehabilitation" means, in relation to a project site, rehabilitation of the project site that is carried out in the course of the operations of the project on the site; (« remise en état progressive »)

"project" means

(a) a mine and includes the machinery, plant, buildings, premises, stockpiles, storage facilities, waste dumps or tailings, whether below or above ground, that are used for, or in connection with, mining, and

(b) an advanced exploration project; (« ouvrage »)

"project site" means the land on which a project is located; (« chantier »)

"qualified exploration expenses" where used in section 7 means exploration expenses incurred to discover new ore bodies; (« frais d'exploration admissibles »)

"rehabilitation" means, in relation to a project site, actions taken for the purpose of

(a) protecting the environment against adverse effects resulting from operations at the project site,

(b) minimizing the detrimental impact on adjoining lands of operations at the project site,

(c) minimizing hazards to public safety resulting from operations at the project site, and

(d) leaving the project site in a state that is compatible with adjoining land uses and that conforms, where applicable, to a zoning by-law or development plan under The Planning Act and to the specifications, limits, terms and conditions of a licence issued under The Environment Act in respect of the project; (« remise en état »)

"short fiscal year" means the period of less than 12 months for which the accounts and financial statements of an operator are prepared when there is a change of fiscal year end approved under section 1.1; (« exercice abrégé »)

"special tax" means a special tax under section 13.1; (« taxe spéciale »)

"tax" means a tax payable under this Act, other than a special tax; (« taxe »)

"tax holiday pool" means the amount relating to a new mine calculated in accordance with Formula 5 set out in the Schedule; (« compte de l'exonération fiscale temporaire »)

"undepreciated balance" where used to refer to the undepreciated balance of depreciable assets of an operator at the end of a fiscal year, means the amount obtained by deducting from the total of the original cost, not including any interest charges, incurred by the operator in acquiring the depreciable assets prior to the end of that fiscal year,

(a) all depreciation claimed and allowed under The Mining Royalty and Tax Act prior to January 1, 1975,

(b) all depreciation claimed and allowed under this Act after December 31, 1974 and prior to the end of that fiscal year,

(c) proceeds from the sale or disposal of any depreciable assets received or receivable prior to the end of that fiscal year or the original cost of the depreciable assets sold or disposed of prior to the end of that fiscal year, whichever is the lesser; and

(d) all amounts deducted by the operator under subsection 13(2) from the tax payable for any previous fiscal year. (« solde non amorti »)

Date of calculation of revenues

1(2)        For the purposes of this Act, the revenue of an operator shall be calculated as follows:

(a) all revenue from the sale or disposal of mineral products to another person shall be calculated as revenue as of the date of delivery of the mineral products to the person to whom they are sold or disposed of;

(b) all revenue from custom processing of mineral bearing substances or mineral products shall be calculated as revenue as of the date each stage of the custom processing is completed;

(c) all revenue from custom mining with respect to which expenses are deducted under subsection 7(1).

Joint ventures

1(3)        Where the members of a partnership, syndicate or any other group of persons are jointly or individually the owners, lessees, tenants, holders or occupiers of a mineral processing establishment as a joint venture, each member of the partnership, syndicate or group of persons engaged in the joint venture is deemed to be an operator of the mineral processing establishment, and not to be dealing at arms length with the other members of the joint venture.

S.M. 1988-89, c. 19, s. 25; S.M. 1989-90, c. 15, s. 50; S.M. 1989-90, c. 91, s. 8; S.M. 1991-92, c. 9, s. 254; S.M. 1992, c. 52, s. 37; S.M. 1994, c. 23, s. 18; S.M. 1995, c. 30, s. 12; S.M. 1998, c. 39, s. 76; S.M. 2003, c. 4, s. 54; S.M. 2005, c. 40, s. 46; S.M. 2006, c. 24, s. 48.

Change of fiscal year end

1.1         Any change to the date of an operator's fiscal year end for the purposes of this Act must be approved by the minister, who must be satisfied that the change is supported by sound business reasons.

S.M. 1992, c. 52, s. 37.

Administration and enforcement

1.2         Part I of The Tax Administration and Miscellaneous Taxes Act applies to the administration and enforcement of this Act.

S.M. 2005, c. 40, s. 47.

Where assets partly within and partly outside the province

2           Where the mine of a mineral processing establishment is situated partly within and partly outside the province, the whole of the mine and all of the assets of the operator of the mineral processing establishment, whether within or outside the province,

(a) that are used and operated by the operator in connection with the mine; and

(b) that are within the province, or, where situated outside the province, are within  80 kilometres of the boundary of the province, and that if they were situated within the province would be depreciable assets of the operator;

shall for the purposes of this Act be conclusively deemed to be depreciable assets of the operator.

S.M. 2006, c. 24, s. 49.

Non-arm's length disposal of depreciable assets

3(1)        Where an operator sells or disposes of a depreciable asset to a person with whom the operator is not dealing at arm's length, the price received for the sale or disposal of the asset shall, for all purposes under this Act, be conclusively deemed to be the undepreciated balance of that asset.

Non-arm's length acquisition of depreciable assets

3(2)        Where an operator acquires a depreciable asset from a person with whom the operator is not dealing at arm's length, the price paid for the acquisition of the asset shall, for all purposes under this Act, be conclusively deemed to be the lesser of the undepreciated balance or the book value of that asset as shown in the books of the person from whom the asset was acquired and for the purpose of calculating an allowance for processing under subsections 10(3), (3.1), (4) and (6) that price shall be conclusively deemed to be the original cost of the asset.

Removal of depreciable asset

3(3)        Where an operator removes from Manitoba a depreciable asset, and does not sell or dispose of it, the depreciable asset shall be conclusively deemed to have been sold by the operator at the undepreciated balance of that asset.

Bringing depreciable asset into Manitoba

3(4)        Where an operator brings into Manitoba a depreciable asset that has been previously used by the operator outside Manitoba, or that has been previously removed by the operator from Manitoba, the depreciable asset shall be conclusively deemed to have been purchased by the operator at the lesser of the undepreciated balance or the book value of that asset and for the purpose of calculating an allowance for processing under subsections 10(3), (3.1), (4) and (6), that price shall be conclusively deemed to be the original cost of the asset.

Calculation of undepreciated balance

3(5)        For the purposes of this section, the undepreciated balance means the undepreciated balance as defined in subsection 1(1) less any allowance for depreciation that has been claimed or could be claimed without producing a loss by the operator under the mining tax or royalty Act of any other jurisdiction.

S.M. 1988-89, c. 19, s. 26; S.M. 1994, c. 23, s. 19; S.M. 2010, c. 29, s. 38.

Calculation of profit

4(1)        The profit of an operator in a fiscal year shall be calculated in accordance with Formula 2 set out in the Schedule.

Profit deemed nil

4(2)        Subject to subsection (3), where in the application of Formula 2 set out in the Schedule, the amount represented by E is greater than the amount represented by R, the profit of the operator for the fiscal year shall be deemed to be nil.

Exception to subsection 4(2):  new mine loss

4(3)        Subsection (2) does not apply in determining the profit of an operator of a new mine in a new mine tax holiday period referred to in section 4.1.

Operator's profit excludes new mine

4(4)        The profit of an operator referred to in subsection (1) shall not include the operator's profit or loss from a new mine that is in a new mine tax holiday period.

S.M. 1992, c. 52, s. 38.

Calculation of profit for new mine

4.1(1)      Subject to subsection (3), the profit of an operator in a fiscal year for a new mine that is eligible for the new mine tax holiday,

(a) shall be calculated separately as if the new mine was the only mine in which the operator had an interest; and

(b) shall be calculated in accordance with Formula 2 set out in the Schedule on the basis of only those revenues and expenses pertaining to the new mine and the annual depreciation allowance to be deducted shall be the amount which is equal to the lesser of

(i) the amount calculated under clause 7(1)(g) at the rate of 20% of the undepreciable balance of the new mine's assets, and

(ii) the amount calculated in accordance with Formula 2 for that new mine before deducting any depreciation allowance under clause 7(1)(g).

Duration of new mine tax holiday period

4.1(2)      An operator of a new mine is eligible for an exemption from tax on the profit from the new mine in a new mine tax holiday period until the fiscal year in which the tax holiday pool, calculated in accordance with Formula 5 set out in the Schedule, is nil or negative.

Profit from new mine at end of tax holiday period

4.1(3)      Where in a fiscal year the amount of the tax holiday pool, calculated in accordance with Formula 5 set out in the Schedule becomes nil or negative, the profit of the operator from a new mine that is in the new mine tax holiday period in that fiscal year is the amount which is calculated in accordance with Formula 6 set out in the Schedule.

S.M. 1992, c. 52, s. 39.

Pre-approval as new mine

4.2(1)      Prior to filing a return under subsection 22(1), an operator may make a request in writing to the director to have a mine approved by the director as a new mine eligible for the new mine tax holiday.

Application for declaration as new mine

4.2(2)      Where a mine is not a new mine under clause (a) of the definition "new mine" in subsection 1(1), the operator may make an application to the minister responsible for The Mines and Minerals Act to have the mine declared a new mine eligible for the new mine tax holiday.

Declaration of new mine by L.G. in C.

4.2(3)      Where the minister responsible for The Mines and Minerals Act receives an application under subsection (2), the minister may submit the application to the Lieutenant Governor in Council to have the mine declared a new mine eligible for the new mine tax holiday.

S.M. 1992, c. 52, s. 39.

Election:  mine excluded from new mine tax holiday

4.3(1)      At the time a return is filed under subsection 22(1), an operator of a new mine may file an election with the director for the new mine to be excluded from the new mine tax holiday.

Effect of election

4.3(2)      If an election is filed under subsection (1),

(a) any profit from the new mine shall not be eligible for the new mine tax holiday calculated in accordance with section 4.1, for that current fiscal year or for subsequent fiscal years;

(b) the operator's processing assets with respect to the new mine shall not be subject to subsection 10(3.1) in that current fiscal year or in subsequent fiscal years;

(c) the undepreciated balance of the new mine's depreciable assets referred to in subsection 11(2.1) shall be added to the operator's undepreciated balance of depreciable assets referred to in clause 7(1)(g) in that current fiscal year; and

(d) the new mine is permanently excluded from the new mine tax holiday.

S.M. 1992, c. 52, s. 39.

Non-arm's length sales

5(1)        Where an operator sells output of a mineral processing establishment to a person with whom the operator is not dealing at arm's length, the director may fix as the price therefor an amount based on the price thereof at the posted Canadian price for the output of that kind as of the date on which the output was delivered to the person, or where there is no posted Canadian price of output for that kind, the price that would be paid as of that date for output of that class by a buyer who was dealing at arm's length with the operator and to whom the operator did not give any special advantage over other buyers, and the amount when so fixed shall, subject to an appeal under Part I, Division 4 of The Tax Administration and Miscellaneous Taxes Act, be conclusively deemed to be the sale price for determining the revenue of the operator, and the director shall notify the operator of the amount so fixed.

Non-arm's length fees

5(2)        Where an operator charges a fee to a person with whom the operator is not dealing at arm's length for processing, the director may fix an amount based on the fee that would be paid for the processing by a person who is dealing at arm's length with the operator and to whom the operator did not give any special advantage over other persons seeking such processing, and the amount, when so fixed, shall, subject to an appeal under Part I, Division 4 of The Tax Administration and Miscellaneous Taxes Act, be conclusively deemed to be the fee for the processing for determining the revenue of the operator, and the director shall notify the operator of the amount so fixed.

S.M. 1995, c. 30, s. 13; S.M. 2005, c. 40, s. 48; S.M. 2010, c. 29, s. 38.

Revenue from output partially processed previously

6           Where the mining or processing of a mineral product was partially done in a fiscal year of the operator previous to the fiscal year in which the processing of that output is completed, regardless of when the mining or processing of the output was begun, the revenues from the sale of the output shall be included in the revenues of the fiscal year in which the output was sold.

Deductible expenses

7(1)        In calculating the profit of an operator in a fiscal year there shall be deducted any of the following expenses, payments and allowances that relate to the mining, processing and sale of output mined in Manitoba, that were incurred in that fiscal year, and that are approved by the director:

(a) the actual costs to the operator of transportation of any output sold, the payment of which is the responsibility of the operator;

(b) the salaries of the employees of the operator paid by the operator;

(c) the actual and proper operating costs of the operator of mining, milling, smelting, refining, recrystallizing or otherwise beneficiating the output in Manitoba;

(d) the actual cost of insurance, and mint and marketing costs of the operator directly relating to marketing the output;

(e) municipal taxes paid by the operator or contributions made to a municipality or local government district in Manitoba for essential municipal or public services either in lieu of municipal taxes or under an agreement with the municipality or local government district;

(f) the actual net costs to the operator for any research that is designed to reduce the cost of output of the mineral processing establishment of the operator, or has as its objective the recovery of additional output from the mineral processing establishment of the operator;

(f.1) the actual net costs to the operator of any research that is designed to develop new products or uses of minerals produced from the operator's mine in Manitoba;

(g) an annual depreciation allowance calculated at a single rate for all depreciable assets, which, subject to section 9, shall not exceed 20% of the undepreciated balance of the depreciable assets of the operator as of the end of the fiscal year for which the profit is being calculated;

(h) exploration expenses incurred by the operator or such portion thereof as the operator may determine;

(i) the actual costs of the operator for the purchase of mineral products mined in Manitoba for further processing or for resale;

(j) any other expenses incurred by the operator attributable to the mining, processing and sale of the output.

Deduction of former exploration expenses

7(2)        In calculating the profit of an operator in a fiscal year there may be deducted exploration expenses approved by the director that were incurred by the operator after December 31, 1978 and before January 1, 1986, whether before of after the operator commenced mining activities in the province and that have not been deducted under this section for the purpose of calculating the profit of the operator in any previous fiscal year.

Deduction of exploration expenses

7(3)        Subject to subsection (4), in calculating the profit of an operator in a fiscal year there may be deducted qualified exploration expenses approved by the director that were incurred by the operator after December 31, 1985, whether before or after the operator commenced mining activities in the province and that have not been deducted under this section for the purpose of calculating the profit of the operator in any previous fiscal year.

Additional qualified exploration deduction

7(3.1)      Where qualified exploration expenses incurred in a fiscal year commencing after December 31, 1991 exceed a simple average of the qualified exploration expenses for the three immediately preceding fiscal years, in calculating the profit of an operator in any fiscal year commencing after December 31, 1991, there may be deducted in addition to an amount calculated under subsection 7(3), an amount equal to 50% of the amount by which the qualified exploration expenses incurred in that fiscal year exceed the simple average of the qualified exploration expenses for the three immediately preceding fiscal years.

Carry forward of amount under subsection 7(3.1)

7(3.2)      Subject to subsection (4), in calculating the profit of an operator in a fiscal year there may be deducted the amount of any deduction calculated under subsection (3.1) that has not been deducted under subsection (3.1) for the purpose of calculating the profit of the operator in any previous fiscal year.

Application to director

7(4)        Where exploration expenses are incurred within or in the immediate vicinity of an operating mine they shall not be deducted under subsection (3) or (3.1) unless the director has, on application by the operator within one year of the exploration expenses being incurred, declared in writing these expenses to be qualified exploration expenses.

Deduction of rehabilitation expenses

7(5)        In calculating the profit of an operator in a fiscal year, there may be deducted

(a) expenses approved by the director that were incurred by the operator for the rehabilitation or progressive rehabilitation of a project site as set out in a closure plan approved by the Director of Mines appointed under The Mines and Minerals Act; and

(b) monies paid by the operator and credited to the Mine Rehabilitation Fund established under subsection 195(1) of The Mines and Minerals Act.

Refund from Mine Rehabilitation Fund

7(6)        In calculating the profit of an operator in a fiscal year, all monies and interest thereon returned to the operator in that fiscal year from the Mine Rehabilitation Fund under subsection 195(3) of The Mines and Minerals Act shall be included.

S.M. 1988-89, c. 19, s. 27; S.M. 1992, c. 52, s. 40.

Non-arms length expenses, etc.

8           Where an operator incurs an expense or pays a fee to obtain or acquire any goods, material, property or service, and the expense or fee was paid or is payable to a person with whom the operator was not dealing at arm's length, the director may fix an amount based on the actual costs incurred by that person not including any profit, gain or commission to that person or to any other party with whom that person or the operator is not dealing at arm's length, and the amount, when so fixed, shall, subject to an appeal under Part I, Division 4 of The Tax Administration and Miscellaneous Taxes Act, be conclusively deemed to be the expense or fee paid or payable for the goods, material, property or service for determining expenses, payments and allowances of the operator, and the director shall notify the operator of the amount so fixed.

S.M. 1995, c. 30, s. 13; S.M. 2005, c. 40, s. 48.

Allowance for larger depreciation

9(1)        Where the life of a mine (or the useful life of a depreciable asset) of a mineral processing establishment justifies a greater rate of depreciation than that allowed under clause 7(1)(g), the Lieutenant Governor in Council may, for any fiscal year specified by the Lieutenant Governor in Council, authorize the annual depreciation to be allowed to the operator of the mineral processing establishment under clause 7(1)(g) to be calculated at a rate exceeding 20% of the undepreciated balance of the depreciable asset but not exceeding 60% of the undepreciated balance of the depreciable asset.

Short fiscal year depreciation allowance

9(2)        Where the fiscal year is a short fiscal year, the depreciation allowance shall be the amount as calculated under clause 7(1)(g), multiplied by the number of days in the short fiscal year, and divided by 365.

S.M. 1992, c. 52, s. 41.

Adjustment of expenses for processing outside Manitoba

10(1)       Where the milling, smelting, refining, recrystallizing or other beneficiating of any mineral or mineral product mined by the operator in Manitoba is done outside Manitoba by the operator in a fiscal year, the director shall determine whether all or part of the deductions mentioned in section 7 shall be allowed in that fiscal year in respect of those minerals and mineral products but in no case shall a deduction be allowed for any expense or allowance that has been claimed or could be claimed without producing a loss by the operator as a deduction under the mining tax or royalty Act of any other jurisdiction.

Adjustment of expenses for minerals outside Manitoba

10(2)       Where depreciable assets of an operator of a mineral processing establishment are used in a fiscal year to mine or process any mineral or mineral product mined by the operator or any other person outside Manitoba, the director shall determine whether all or part of the deductions mentioned in section 7 in respect of those minerals and mineral products shall not be allowed in that fiscal year.

Processing allowance for in-province processing

10(3)       Subject to subsections (3.1), (5) and (7), where the processing of any mineral or mineral product mined in Manitoba from a mineral processing establishment is done in Manitoba by the operator in a fiscal year, the director may approve for the fiscal year in respect of those mineral products

(a) an allowance for processing by way of return on capital employed by the operator that does not exceed the total of the amounts calculated in accordance with Formula 3 set out in the Schedule for each stage of the processing; and

(b) an additional allowance for processing by way of return on capital employed by the operator that does not exceed the total of the amounts calculated in accordance with Formula 7 set out in the Schedule for each stage of the processing.

New mine processing assets

10(3.1)     An operator

(a) shall account separately for processing assets that relate to a new mine in the new mine tax holiday period;

(b) shall not include the processing assets referred to in clause (a) in the calculation of any processing allowance under Formula 3, 4 or 7 set out in the Schedule; and

(c) shall, where in the fiscal year the new mine tax holiday period expires, include the processing assets referred to in clause (a) in the calculation of any processing allowance under Formula 3, 4 or 7 set out in the Schedule, for the next following fiscal year and for subsequent fiscal years.

Processing allowance for service assets

10(4)       Subject to subsections (5) and (7), where the processing of any mineral or mineral product mined in Manitoba from a mineral processing establishment is done in Manitoba by the operator in a fiscal year and the director has approved an allowance in that fiscal year under clause (3)(a), the director shall approve for that fiscal year, by way of return on capital employed by the operator in respect of assets that were necessary to the servicing and management of the processing activities of the operator in that fiscal year but that are not processing assets, an additional allowance equal to 25% of the amount of the allowance approved under clause (3)(a) for that fiscal year.

Maximum processing allowance

10(5)       Where for any fiscal year, other than a short fiscal year, allowances are approved under subsections (3), (4) and (6), the total of those allowances approved for that fiscal year under those subsections shall not be more than 65% of the profit of the operator in that fiscal year as calculated before the allowances under those subsections but after the deduction of all expenses, payments and allowances deductible under section 7.

Processing allowance for out of province processing

10(6)       Subject to subsections (5) and (7), where the processing of any mineral or mineral bearing product mined in Manitoba from a mineral processing establishment is done outside Manitoba by the operator in a fiscal year, the director may approve for the fiscal year in respect of those mineral products an allowance for processing by way of return on capital employed by the operator not exceeding an amount calculated in accordance with Formula 4 set out in the Schedule but in no case shall an allowance for processing be allowed where a processing allowance has been claimed or could be claimed by the operator under the mining tax or royalty Act of any other jurisdiction.

Short fiscal year processing allowance

10(7)       For a fiscal year that is a short fiscal year, the director may approve a processing allowance calculated in accordance with subsections (3), (4) and (6), multiplied by the number of days in the short fiscal year, and divided by 365 but the total of those allowances approved for that short fiscal year under those subsections shall not be more than 65% of the profit of the operator in that short fiscal year as calculated before the allowances under those subsections but after the deduction of all expenses, payments and allowances deductible under section 7.

S.M. 1988-89, c. 19, s. 28; S.M. 1992, c. 52, s. 42; S.M. 1994, c. 23, s. 20.

Capital investment, interest and depletion not allowed

11(1)       No allowance or deduction shall be allowed under section 7

(a) for capital invested; or

(b) for interest; or

(c) for dividends upon capital stock; or

(d) for depreciation in the value of a mine, mining land or mining property, by reason of exhaustion or partial exhaustion of the ore or mineral; or

(e) for moneys paid in acquiring the right to mine or an option to the right to mine; or

(f) for that portion of an expenditure for which or based on which monies have been received in the form of a grant, subsidy or other assistance.

Depreciation allowance in joint ventures

11(2)       Notwithstanding the definition "depreciable assets" an allowance for depreciation may be allowed under section 7 where an operator invests in depreciable assets in order to acquire an interest in a mine where that operator is a member of a partnership, syndicate, or group of persons engaged in a joint venture in the operation of that mine.

New mine depreciable assets

11(2.1)     Where an operator of a new mine in the new mine tax holiday period incurs expenditures for depreciable assets for that new mine after March 11, 1992, a depreciation allowance for the fiscal year as calculated under clause 4.1(1)(b) or, as calculated under subsection 9(2) where the fiscal year is a short fiscal year, shall be allowed for all such depreciable assets provided that they

(a) relate only to that new mine;

(b) are accounted for separately by the operator; and

(c) are approved by the director.

Undepreciated balance of new mine assets

11(2.2)     Where in a fiscal year the new mine tax holiday period expires, the undepreciated balance of the new mine's depreciable assets referred to in subsection (2.1) shall be added to the operator's undepreciated balance of depreciable assets referred to in clause 7(1)(g), for the next following fiscal year.

Deduction for exploration expenses in joint ventures

11(3)       Notwithstanding the definition "exploration expenses" a deduction for exploration expenses may be allowed under section 7 where an operator incurs exploration expenses in order to acquire an interest in a mine where that operator is a member of a partnership, syndicate, or group of persons engaged in a joint venture in the operation of that mine.

S.M. 1988-89, c. 19, s. 29; S.M. 1992, c. 52, s. 43.

Inter-provincial agreements to fix method of determining profit

12          Where an operator carries on mining or processing in Manitoba and in any other province, and the nature of the operator's establishment is such as to render it difficult or impossible to ascertain the profit of the operator for the purposes of calculating tax payable under this Act, or under similar legislation of that other province, the minister may, with the approval of the Lieutenant Governor in Council, enter into an agreement with the operator and the government of that other province, or a minister thereof, providing for the method of determining the profit, within each province; of the operator for any fiscal year that occurs while the agreement is in force, and where a provision of any such agreement is inconsistent with or repugnant to a provision of this Act, the provision of the agreement prevails.

Imposition of tax

13(1)       An operator of a mineral processing establishment in Manitoba must pay to the minister a tax for each fiscal year equal to

(a) 10% of the operator's profit for the year, if the profit for the year is $50,000,000 or less;

(b) $5,000,000 plus 65% of the operator's profit for the year in excess of $50,000,000, if the profit for the year is more than $50,000,000 and not more than $55,000,000;

(c) 15% of the operator's profit for the year, if the profit for the year is more than $55,000,000 but not more than $100,000,000;

(d) $15,000,000 plus 57% of the operator's profit for the year in excess of $100,000,000, if the profit for the year is more than $100,000,000 and not more than $105,000,000; or

(e) 17% of the operator's profit for the year, if the profit for the year is more than $105,000,000.

Deduction of new investment credit from tax

13(2)       Notwithstanding subsection (1), an operator may, in paying tax or in calculating or estimating the tax payable by the operator for any fiscal year deduct from the tax payable an amount equal to the lesser of

(a) the new investment credit of the operator as of the last day of that fiscal year; or

(b) where

(i) the new investment credit is calculated in accordance with Formula 1, 50% of the tax calculated under subsection (1), or

(ii) the new investment credit is calculated in accordance with Formula 1.1, or in accordance with Formula 1 and 1.1, 30% of the tax calculated under subsection (1).

S.M. 1988-89, c. 19, s. 30; S.M. 1994, c. 23, s. 21; S.M. 1999, c. 3, s. 13; S.M. 2009, c. 26, s. 38; S.M. 2010, c. 29, s. 39.

Definitions

13.1(1)     In this section, "taxation year", "taxable income" and "gross revenue" mean taxation year, taxable income and gross revenue, respectively, as defined in The Income Tax Act and "income tax" means the tax payable under The Income Tax Act.

Special tax

13.1(2)     An operator of a mineral processing establishment shall pay to the minister a special tax calculated at the rate of

(a) 1.5% of the profits of the operator for each fiscal year commencing after December 31, 1988 and ending on or before April 20, 1994; and

(b) .5% of the profits of the operator for each fiscal year ending after April 20, 1994.

Tax refund

13.1(3)     Where, in respect of the 1989 or a subsequent taxation year, an operator pays

(a) income tax for the taxation year; or

(b) a special tax;

and the aggregate of the amounts paid under clauses (a) and (b) exceeds

(c) the amount of income tax that would be payable by the operator in respect of the taxation year if the taxable income of the operator earned in Manitoba were calculated in accordance with Part IV of the Income Tax Regulations made under the Income Tax Act (Canada) with the exception that where the operator sells to a customer a shipment of mineral product produced from mineral mined in Canada and the destination of the shipment is in a country other than Canada, the gross revenue derived from the shipment, and to be attributed to Manitoba under Part IV, be the gross revenue derived from mineral product produced from mineral mined in Manitoba;

the minister may refund the excess to the operator in an amount not exceeding the amount paid under clause (b).

Special tax to be treated as tax

13.1(4)     The provisions of this Act in respect of tax under this Act, other than subsection 14(1), apply to a special tax.

S.M. 1989-90, c. 15, s. 51; S.M. 1990-91, c. 13, s. 8; S.M. 1992, c. 52, s. 44; S.M. 1994, c. 23, s. 22; S.M. 2000, c. 39, s. 70.

Time for payment of tax

14(1)       Every operator liable for payment of a tax for a fiscal year, other than for a short fiscal year, shall pay to the minister on account of the tax for that fiscal year

(a) on or before the 25th day of each of the last 10 months in the fiscal year, an amount equal to

(i) 1/10th of the tax payable by the operator for that fiscal year, as estimated by the operator based on the operator's estimated profit for that fiscal year, or

(ii) 1/10th of the amount of tax paid or payable by the operator for the next previous fiscal year, or

(iii) where the next previous fiscal year referred to in subclause (a)(ii) was a short fiscal year, the amount of tax paid or payable by the operator for that next previous short fiscal year divided by the number of complete months in that short fiscal year;

and

(b) on or before the 25th day of the third month of the next following fiscal year, the remainder, if any, of the tax payable by the operator for that fiscal year as calculated under this Act.

Time for payment of tax if short fiscal year

14(1.1)     Every operator liable for payment of a tax for a short fiscal year shall pay to the minister on account of the tax for that short fiscal year

(a) on or before the 25th day of each complete month in the short fiscal year, an amount equal to

(i) the amount of tax payable by the operator for that short fiscal year as estimated by the operator, divided by the number of complete months in that short fiscal year, or

(ii) the amount of tax paid or payable by the operator for the next previous fiscal year divided by 12; and

(b) on or before the 25th day of the third month of the next following fiscal year, the remainder, if any, of the tax payable by the operator for that short fiscal year as calculated under this Act.

Special tax payment

14(2)       Where an operator is liable for payment of a special tax, the operator shall pay the special tax on or before the 25th day of the third month of the fiscal year following the taxation year for which the special tax is payable.

S.M. 1989-90, c. 15, s. 52; S.M. 1990-91, c. 13, s. 9; S.M. 1992, c. 52, s. 45; S.M. 2010, c. 29, s. 40.

15 to 21    Repealed.

S.M. 1988-89, c. 19, s. 31 and 32; S.M. 1992, c. 52, s. 46; S.M. 1998, c. 30, s. 33 and 34; S.M. 2002, c. 19, s. 41; S.M. 2003, c. 4, s. 55 and 56; S.M. 2004, c. 43, s. 59; S.M. 2005, c. 40, s. 49.

Filing of return

22(1)       Every operator of a mineral processing establishment shall, without any demand therefor, on or before the last day of the sixth month following a fiscal year end file with the director an information return, in a form approved by the director, setting out all the information required by the form.

Estimate of tax

22(2)       Every operator filing a return under this Act shall, in the return, calculate the amount of tax payable by the operator for the fiscal year to which the return relates.

22(3)       Repealed, S.M. 2005, c. 40, s. 50.

S.M. 1992, c. 52, s. 47; S.M. 2003, c. 4, s. 57; S.M. 2005, c. 40, s. 50; S.M. 2006, c. 24, s. 50; S.M. 2010, c. 29, s. 41.

Unconsolidated financial statement

23          Each return filed under this Act by an operator shall be accompanied by audited unconsolidated financial statements of the operator and detailed statements of the operations of the operator indicating the expenses, revenues, assets, liabilities and any other details that may be required by the director allocated to the mineral processing establishment of the operator within Manitoba and to the operations of the operator outside Manitoba and the information contained in the detailed statements shall be reconciled with the unconsolidated financial statements.

S.M. 2010, c. 29, s. 42.

24 to 35    Repealed.

S.M. 1988-89, c. 19, s. 33 to 41; S.M. 1994, c. 23, s. 23; S.M. 1995, c. 30, s. 14 to 18; S.M. 1998, c. 30, s. 35 to 38; S.M. 2003, c. 4, s. 58 to 61; S.M. 2004, c. 43, s. 60 and 61; S.M. 2005, c. 40, s. 51; S.M. 2007, c. 6, s. 50.

Notice of active operation

36(1)       Every operator of a mineral processing establishment shall within 10 days after a mine is placed in operation for production of minerals or mineral products serve the director with a notice in writing setting out

(a) the name and location of the mineral processing establishment;

(b) a description of the processing carried on in the mineral processing establishment;

(c) the location, name and a description of any mine operated as part of the mineral processing establishment;

(d) the name and address of the operator;

(e) the name and address of the manager of the mineral processing establishment or of some other person to whom notices required to be given under this Act or the regulations may be given; and

(f) the date on which the mineral processing establishment was placed in operation;

and shall notify the director in writing of any change in the information set out in the notice or any suspension or termination of operation of the mineral processing establishment.

Notice of shipping

36(2)       No operator shall ship, send, take or carry away or permit to be shipped, sent, taken or carried away, any mineral or mineral product from a mineral processing establishment before the notice required under subsection (1) relating to the mineral processing establishment is served on the director unless permission for the shipping, sending, taking or carrying away has been granted in writing by the director.

37 to 42    Repealed.

S.M. 1988-89, c. 19, s. 42 and 43; S.M. 2005, c. 40, s. 51.

Tax paid into Consolidated Fund

43          The moneys received by way of tax under this Act, shall be paid into the Consolidated Fund and, except for the sums transferred under section 44 to the mining community reserve, shall be used as general revenues of the government.

Mining community reserve continued

44(1)       The mining community reserve established in the Consolidated Fund shall be continued.

Payments into reserve

44(2)       Before the books of the government for a fiscal year have been closed, the Lieutenant Governor in Council may order a portion of the taxes received or receivable under this Act for the year to be transferred to the mining community reserve.  That portion must not exceed 6% of the taxes received or receivable for the year.  If the order is made after the end of the fiscal year the transfer is deemed to have occurred on the last day of that fiscal year.

Authority to pay from reserve

44(3)       In addition to all or any moneys authorized to be expended under any other Act of the Legislature, the Lieutenant Governor in Council may

(a) direct amounts to be paid from the mining community reserve for the welfare and employment of persons residing in a mining community which may be adversely affected by the total or partial suspension, or the closing down, of mining operations attributable to the depletion of ore deposits;

(a.1) where the amount in the mining community reserve exceeds $10,000,000., direct the excess amount or any part of it to be used to encourage and assist exploration projects that contribute to the welfare and employment of persons residing in mining communities;

(b) direct the making of loans or advances from the mining community reserve, or the guaranteeing of the repayment of loans or advances made from other sources, to any person for the purposes mentioned in clause (a);

(c) direct that expenditures made for the purposes mentioned in clauses (a) and (a.1) by any person and from any source be shared by means of payment from the mining community reserve and provide that any expenditure to be so shared may, in the first instance, be paid from the mining community reserve;

(d) authorize a member of the Executive Council to enter into agreements for and on behalf of the government for the purposes mentioned in clauses (a) and (a.1) and authorize the expenditure from the mining community reserve for the purposes of carrying out the agreements; and

(e) authorize the doing of anything that the Lieutenant Governor in Council considers necessary for the purposes mentioned in clauses (a) and (a.1).

Payment from reserve

44(4)       The Minister of Finance may make payments out of the mining community reserve in accordance with any direction or authority granted under subsection (3).

Transfer of interest

44(5)       Where the amount in the mining community reserve exceeds $10,000,000., the Minister of Finance, with the authority of the Lieutenant Governor in Council, may transfer from the mining community reserve all or any part of the income or interest received from the investment of the moneys in the reserve or allowed on unexpended balances in the reserve and the amount so transferred shall be treated as revenue of the government; but any part of that interest or income not transferred under this subsection remains a part of the mining community reserve.

Authority to transfer from reserve

44(6)       Where the amount in the mining community reserve exceeds $10,000,000., the Minister of Finance, with the authority of the Lieutenant Governor in Council, may transfer from the mining community reserve the amount, or any part of the amount, by which the reserve exceeds $10,000,000. and the amount so transferred shall be treated as revenue of the government.

Recoveries

44(7)       Where any moneys expended, advanced or loaned under the authority of this section are repaid or recovered by the government, the amount repaid or recovered shall be credited to the mining community reserve.

Authorization not to lapse

44(8)       Notwithstanding any other Act of the Legislature, where any expenditure is directed or authorized under this section, the authority or direction does not lapse and shall not be written off at the close of any fiscal year.

S.M. 1988-89, c. 19, s. 44; S.M. 1998, c. 12, s. 2; S.M. 2009, c. 26, s. 39; S.M. 2010, c. 29, s. 43.

44.1        Repealed.

S.M. 1998, c. 30, s. 39; S.M. 2005, c. 40, s. 51.

Regulations

45(1)       The Lieutenant Governor in Council may make regulations

(a) prescribing information to be contained in, or filed in respect of, returns required under this Act;

(b) prescribing the manner in which the detailed statements of an operator's operations to be filed under section 23 are to be reconciled with the operator's unconsolidated financial statements;

(c) respecting any other matter the Lieutenant Governor in Council considers necessary or advisable for the purposes of this Act.

Effective date

45(2)       A regulation under this section may be made retroactive to the extent the Lieutenant Governor in Council considers it necessary in order to implement or give effect to

(a) a tax or administrative measure included in a budget presented to the Legislative Assembly; or

(b) an amendment to this Act.

S.M. 1990-91, c. 13, s. 10; S.M. 2003, c. 4, s. 62; S.M. 2005, c. 40, s. 52.

46 and 47   Struck out.

R.S.M. 1987 corr.

SCHEDULE

FORMULA 1 (Subsection 13(2))

New investment credit = (.05 x I) - A

In this formula

I

is the total amount invested by the operator in depreciable assets after December 31, 1978 and before January 1, 1988

(i) in the construction and equipping of new mining or processing structures or facilities in Manitoba,

(ii) in the major expansion or modernization of mining or processing structures or facilities in Manitoba that is undertaken for the purpose of increasing the potential production of the structures or facilities or diversifying the production of the structures or facilities and that is declared by the Lieutenant Governor in Council to be an approved expansion or modernization expenditure for the purposes of this Formula, and

(iii) in the major alteration, addition or renovation to mining or processing structures or facilities in Manitoba for the purpose in meeting standards imposed under, and with which the operator is required to comply by reason of, The Environment Act, The Workplace Safety and Health Act or the Fisheries Act (Canada) or any regulation made under any of those Acts and that is declared by the Lieutenant Governor in Council to be an approved alteration, addition or renovation expenditure for the purposes of this Formula,

but does not include any amount expended for ordinary on-going maintenance or replacement of any structure or facility or for feasibility studies or other intangible assets where the project is not proceeded with as recommended in those studies; and

A

is the amount of new investment credit calculated under this Formula for the purposes of a previous fiscal year and deducted from the tax payable by the operator for any previous fiscal year.

S.M. 1988-89, c. 19, s. 45; S.M. 1989-90, c. 90, s. 27; S.M. 1994, c. 23, s. 24.

FORMULA 1.1 (Subsection 13(2))

New investment credit = (.07 x I) - A

In this formula

I

is the total amount invested by the operator in depreciable assets after April 20, 1994 and before January 1, 2004

(i) in the construction and equipping of new mines,

(ii) in the construction and equipping of processing structures or facilities in Manitoba where that stage of processing was not previously performed on that site, and

(iii) in the major expansion or modernization of mining or processing structures or facilities in Manitoba that is undertaken for the purpose of increasing the potential production of the structures or facilities or diversifying the production of the structures or facilities and that is declared by the Lieutenant Governor in Council to be an approved expansion or modernization expenditure for the purposes of this Formula,

but does not include any amount expended for ordinary on-going maintenance or replacement of any structure or facility or for feasibility studies or other intangible assets where the project is not proceeded with as recommended in those studies; and

A

is the amount of new investment credit calculated under this Formula for the purposes of a previous fiscal year and deducted from the tax payable by the operator for any previous fiscal year.

S.M. 1994, c. 23, s. 24.

FORMULA 2 (Sec. 4)

Profit for fiscal year = R - E

In this formula

R

is the total of

(a) the revenues of the operator in the fiscal year from the sale or disposal of mineral products that were mined within Manitoba, whether or not the output has been partially processed outside Manitoba; and

(b) the revenues of the operator in the fiscal year as a result of the custom processing in Manitoba of mineral products originating from ore mined in Manitoba; and

(c) the revenues from custom mining with respect to which expenses are deducted under subsection 7(1) of the Act; and

E

is the total of all expenses, payments and allowances that may be deducted as determined in accordance with sections 7 to 12.

S.M. 1989-90, c. 15, s. 53.

FORMULA 3 (Clause 10(3)(a))

Allowance in fiscal year for processing minerals or mineral products in Manitoba = M / N x Q x .08

In this formula

M

is the quantity of the mineral bearing substances mined in Manitoba that were processed in each stage of processing by processing assets of the operator in the fiscal year;

N

is the total quantity of mineral bearing substances from all sources that were processed in each stage of processing by processing assets of the operator in the fiscal year; and

Q

is the original cost of the processing assets of the operator actually used in each of the stages of processing in the fiscal year in processing the output of the mine less all amounts, with respect to the purchase of processing assets, deducted by the operator under subsection 13(2) from the tax payable in any previous fiscal year.

S.M. 1994, c. 23, s. 24.

FORMULA 4 (Subsec. 10(6))

Allowance in fiscal year for profit earned from processing outside Manitoba = O x M / N x .08

In this formula

O

is the original cost of the assets of the operator that are located outside Manitoba, that, if they were located within Manitoba, would be processing assets of the operator and that were used in the fiscal year for which the allowance is being calculated by use of the formula, for processing minerals or mineral products mined in Manitoba less all depreciation charged to those assets as shown in the books of the operator for the purposes of preparing financial statements for the shareholders of the operator up to the end of the fiscal year immediately preceding the fiscal year for which the allowance is being calculated by use of the formula;

M

is the quantity of mineral bearing substances mined in Manitoba that were processed by those assets in the fiscal year; and

N

is the total quantity of mineral bearing substances from all sources that was processed by those assets in the fiscal year.

S.M. 1989-90, c. 15, s. 53.

FORMULA 5 (Section 4.1)

Tax holiday pool = H + A - D - P - N

In this formula

H

is the balance of the tax holiday pool of the operator relating to a new mine at the end of the previous fiscal year;

A

is the expenditures incurred after March 11, 1992 and prior to the new mine achieving production in reasonable commercial quantities, for the acquisition of depreciable assets, including processing assets, of the new mine in the current fiscal year, in accordance with the Act;

D

is the proceeds of disposal for depreciable assets, including processing assets, of the new mine in the current fiscal year, in accordance with the Act;

P

is the new mine profit, before depreciation allowance, earned by the operator in the current fiscal year, in accordance with subsection 4.1(1); and

N

is the new investment credit, relating to assets referred to in A, calculated in accordance with Formula 1.1.

S.M. 1992, c. 52, s. 48; S.M. 1994, c. 23, s. 24.

FORMULA 6 (Subsection 4.1(3))

Tax holiday profit in the fiscal year the new mine tax holiday period ends = (H + A - D - N) / P x Q

In this formula

H

is the balance of the tax holiday pool of the operator relating to a new mine at the end of the previous fiscal year;

A

is the expenditures incurred after March 11, 1992 and prior to the new mine achieving production in reasonable commercial quantities, for the acquisition of depreciable assets, including processing assets, of the new mine in the current fiscal year, in accordance with the Act;

D

is the proceeds of disposal for depreciable assets, including processing assets, of the new mine in the current fiscal year, in accordance with the Act;

P

is the new mine profit, before depreciation allowance, earned by the operator in the current fiscal year, in accordance with subsection 4.1(1);

Q

is the new mine profit, after depreciation allowance, earned by the operator in the current fiscal year, in accordance with subsection 4.1(1); and

N

is the new investment credit, relating to assets referred to in A, calculated in accordance with Formula 1.1.

S.M. 1992, c. 52, s. 48; S.M. 1994, c. 23, s. 24.

FORMULA 7 (Clause 10(3)(b))

Additional allowance in fiscal year for processing minerals or mineral products in Manitoba = M / N x Q x .1

In this formula

M

is the quantity of the mineral bearing substances mined in Manitoba that were processed in each stage of processing by processing assets of the operator as referred to in Q in the fiscal year;

N

is the total quantity of mineral bearing substances from all sources that were processed in each stage of processing by processing assets of the operator as referred to in Q in the fiscal year; and

Q

is the original cost of the processing assets invested by the operator after April 20, 1994

(i) in the construction and equipping of new mines,

(ii) in the construction and equipping of processing structures or facilities in Manitoba where that stage of processing was not previously performed on that site, and

(iii) in the major expansion or modernization of processing structures or facilities in Manitoba that is undertaken for the purpose of increasing the potential production of the structures or facilities or diversifying the production of the structures or facilities and that is declared by the Lieutenant Governor in Council to be an approved expansion or modernization expenditure for the purposes of this Formula,

that are actually used in each of the stages of processing in the fiscal year in processing the output of the mine less all amounts, with respect to the purchase of processing assets, deducted by the operator under subsection 13(2) from the tax payable in any previous fiscal year.

S.M. 1994, c. 23, s. 24.