The Canadian government will extend the business tax deduction for zero-emission vehicles and equipment to cover mining operations, Prime Minister Justin Trudeau announced Monday afternoon, as he believes the sector has an important role to play in the fight against climate change.
Speaking in Toronto to a convention hosted by the Prospectors & Developers Association of Canada (PDAC), Trudeau stated that his government would be seeking input from business and industry on how to achieve net-zero emissions by 2050.
“Around the world and right here in Canada, the debate between environment and economy is becoming increasingly contentious and polarized,” Trudeau said. “I think we can all agree that it’s unhelpful for polarized views to define the battleground of a debate.”
The Prime Minister pointed to both the recent decision by global investment giant BlackRock to focus on climate change and the environmental concerns raised by Teck Resources’ Don Lindsay when the chief executive officer announced his company was withdrawing its application for the Frontier oilsands mine.
During last year’s election campaign, Trudeau made the commitment to pursue net-zero emissions, promising to draft a plan to achieve it and to introduce legislation that would set out a series of interim targets. He also vowed to show how the nation is to meet its emissions targets for 2030.
Commenting on the role Canada’s mining sector would play in achieving its climate goals, Trudeau argued that “a thriving mining industry and a thriving natural resource sector don’t have to be impediments to fighting climate change.”
“To produce high-density batteries and wind turbines, you need copper, nickel and cobalt,” he added. “To build a solar panel, you need 19 metals and minerals. Canada is home to 14 of them.”
Under this new incentive, vehicles would need to be available for use before 2024 to be eligible for an income tax deduction of 100%. The deduction allowance would decrease to 75% for 2024 and 2025, and 55% for 2026 and 2027.
Vehicles that are not available for use before 2028 would not be eligible for the accelerated deduction allowance.