The Quebec government has unveiled new mining royalties, which it expects will bring in hundreds of millions of dollars in extra revenue.
On Monday, the Parti Québécois announced its long-awaited policy, which immediately received criticism from both the Liberals and the Coalition Avenir Québec, despite not being nearly as harsh as anticipated.
The new hybrid system will charge all mining companies a base tax rate that could range between one and four per cent, depending on the estimated value of the raw ore.
The second part of the system involves a profit royalty tax.
Royalties on company profits will be set at minimum rate of 16 per cent and will increase depending on the company’s profit margins. The royalties could range between 17 and 22.9 per cent.
The government estimates the new tax system could bring in up to $1.8 billion in extra revenue over the next 12 years.
During the 2012 election campaign, the PQ criticized the reigning Liberal party for virtually giving away Quebec's natural resources and promised it would make mining companies pay more.
In 2011, in response to Jean Charest’s Plan Nord, Marois said she would like Quebec to claim royalties of up to 50 per cent of the value of extracted minerals.
While the PQ may have lowered its expectations since then, both the Liberal and Coalition Avenir Québec parties are voicing criticism.
François Bonnardel, the CAQ’s critic for natural resources, said mining companies are already hesitant to invest in Quebec.
"I’ve met a lot of these companies that told me that they put a hold on an investment for the next months," he said.
Liberal finance critic Raymond Bachand anticipated today’s announcement, criticizing the government for its plan before it was officially announced.
He defended his party, pointing out that under the Liberal government mine royalties jumped from $30 million to $290 million a year.
Bachand also said he is concerned mining companies are being scared away.
Outside of political circles, the Quebec Mining Association says the province is changing the rules in the middle of the game and threatening Quebec's international reputation as a mining-friendly area.
Environmental groups have also criticized the new royalties, saying the PQ has broken its election promise to get tough with the industry.