Why Can't Canada Be Like Norway on Oil Revenues?

[captain morgan]

UK Government Report: Global Warming Stopped 16 Years Ago…

 

[Machjo]

Oil-Rich Norway Doubles Its Carbon Tax on Oil Companies



Norway to double carbon tax on oil industry | Environment | guardian.co.uk


Norwegian oil companies, while far from perfect, are not Ecuador-decimating, climate change denial-promoting, private corporations with lobbying fleets the size of the navy.

There will be no multimillion dollar campaign to convince the public that climate change is a hoax, and that small fees on their product will bankrupt the economy.

Norway's government is going above and beyond to demonstrate its willingness to be a good global citizen, to do its part to slow the rise climate change.

I can definitely agree with a carbon-tax, as it's far more user-pay than most taxes. And we need to discourage excessive use of non-renewable resources.

 

[captain morgan]

I can definitely agree with a carbon-tax, as it's far more user-pay than most taxes. And we need to discourage excessive use of non-renewable resources.

Will you support that the tax be applied on the end user as opposed to the oil industry, thereby only taxing those that contribute the CO2 as opposed to a broad and generalized tax that can indirectly tax those that don't emit? Basically, get the consumer to pay at the pump, on their nat gas bill and on any product (food incl) that employed hydrocarbons in the transportation and production of the product?

 

[Machjo]

Will you support that the tax be applied on the end user as opposed to the oil industry, thereby only taxing those that contribute the CO2 as opposed to a broad and generalized tax that can indirectly tax those that don't emit? Basically, get the consumer to pay at the pump, on their nat gas bill and on any product (food incl) that employed hydrocarbons in the transportation and production of the product?

Better than any tax, I'd rather the government just sell the crown resources at a much higher price, thus ensuring the resource exploitation company must pay more to buy the rights to the resource, an overhead cost then applied to the consumer wherever in the world he may be. Non-renewable resources are non-renewable after all, so must be discouraged by all consumers in whatever jurisdiction they may reside.

And if you don't want to pay the higher cost of gas, then don't buy it. But unlike with taxes, at least you have a choice of how much gas to buy.

 

[captain morgan]

I don't disagree with your suggestion on this; however, the comment on selling the resources at a higher price is measured in relative terms. The reserves are only worth what the commodity price is at any given time (and futures markets). That said, back in the day when WTI was selling for $30/bbl, the gvt nay get a strong price, but it pales in comparison to when WTI is $100/bbl.

The royalty structure imposed by gvts corrects for this, but in the end, the E&P companies look specifically at the economics and the companies will go to those jurisdictions where their returns are strongest.

In the end, the gvts have to balance the present and future values of the money they stand to collect and if they can deploy those funds on an effective basis, they (the community) will win

 

[petros]

****....more people who enjoy paying taxes.....


HELP!

 

[taxslave]

I would have thought my original post would have made that clear. However, here is an itemized list of reasons as to why domestic development of resources is superior to foreign investment. .
Development of resources by Canadain firms insures:
1. that most jobs will be carried out by Canadians
2. that Revenues generated by Canadian firms stay in Canada rather than being eported to foreign nations.
3. that technological innovations created by Canadain firms can be exported to other nations and Canada does not have to pay the
cost of importing foreign technology
4. that Canadain firms would be large enough to compete in the international marketplace and take part in the development of
resources in other nations
5. that the political influence of foreign firms in Canada's governments would be diminished.
6. that the refining or natural resources would occur in Canada rather tha in foreign nations thus giving added value to Canadian
products

I probably missed one or two other reasons, but these should do for now.

Although I basically agree with you I see Two big problems. Resources are provincial jurisdiction not federal. Good luck getting the necessary permits in Canada to build refining facilities for any resources, not just oil. Those that are independently wealthy do not want the rest of us to have good paying jobs.

It isn't so much about taking advantage of poorer nations as it is to stop giving the lions share of the available profit to international oil corps. BP makes $28 billion after spending around $45 billion in the gulf, this leads me to believe we could charge them another billion or 2 a year and they would still be very profitable. Multiply that times a few and then add a bunch more for the smaller guys and think of what we could pay for. You want universal healthcare and education (including post-secondary)....there's your funding.

Looking at the revenue generated by Norway and Venuzuela from smaller production we are giving the stuff away far to cheap.

The lions share of the profits is not going to the major oil companies. It is going to the parasites that control the futures market. Produce nothing, give nothing back but take most of the loot.

Better than any tax, I'd rather the government just sell the crown resources at a much higher price, thus ensuring the resource exploitation company must pay more to buy the rights to the resource, an overhead cost then applied to the consumer wherever in the world he may be. Non-renewable resources are non-renewable after all, so must be discouraged by all consumers in whatever jurisdiction they may reside.

And if you don't want to pay the higher cost of gas, then don't buy it. But unlike with taxes, at least you have a choice of how much gas to buy.

Maybe if you live in the city and have taxpayer subsidized transportation or collect a government cheque. The rest of us require oil to get to work and to produce our products/services.
Carbon taxes and Cap/trade are wealth redistribution scams.

 

[captain morgan]

The lions share of the profits is not going to the major oil companies. It is going to the parasites that control the futures market. Produce nothing, give nothing back but take most of the loot.

I don't know the answer to the above comment, but I would speculate that the real lion's share goes to gvt in the form of income taxes, fees, licenses, royalties, land/mineral sales, and permits (et al)... Those would be direct costs and we still haven't recognized how much tax (and GST/HST) is added to each litre of gas/diesel

 

[taxslave]

I don't know the answer to the above comment, but I would speculate that the real lion's share goes to gvt in the form of income taxes, fees, licenses, royalties, land/mineral sales, and permits (et al)... Those would be direct costs and we still haven't recognized how much tax (and GST/HST) is added to each litre of gas/diesel

I was not including what all the various levels of government steal. Vancouver area also has a local gas tax to finance cheap public transportation. Problem with this is that they are to close to the US so a lot of people go south for gas and groceries which does not help the Canadian economy at all. Might call them citizens of convenience.

 

[captain morgan]

I was not including what all the various levels of government steal. Vancouver area also has a local gas tax to finance cheap public transportation. Problem with this is that they are to close to the US so a lot of people go south for gas and groceries which does not help the Canadian economy at all. Might call them citizens of convenience.

In my eyes, the cost in time and fuel to head to the US to gas-up outweighs the benefit, but there is a tipping point where that cost becomes justified (especially if you go and fill your trunk with groceries, etc).

In a way, the circumstance in BC (people crossing into WA to purchase) is an example of the influences and pressures that may occur in those jurisdictions that penalize the middle and high income earners... The money flees the jurisdiction (either physically or like shopping in WA). The money benefits the communities like Bellingham, etc through taxes collected, employment etc, but more importantly, it doesn't benefit Ladner, Twassen or Vancouver small business and the community via taxes, employment, etc.

In the event that Marois triggers her tax scheme on the middle and high income earners in Que; we'll get a first hand glimpse of the suggestion that I just made... That's a big risk to take and I think that Obama and Marois are playing with fire

 

[petros]

I was not including what all the various levels of government steal. Vancouver area also has a local gas tax to finance cheap public transportation.

I just got back from a 2 weeks in Vancouver...when we first landed Mrs gets the idea "hey..let's try the Canada Line.". So we go to the ticket machine and find they want $10 from each of us to get downtown. By the time she got to the ticket machine after the long line up, I already had a car rented and waiting downstairs for $12.95 a day.

We were already up $7 and change by driving.

 

[Bar Sinister]

Although I basically agree with you I see Two big problems. Resources are provincial jurisdiction not federal. Good luck getting the necessary permits in Canada to build refining facilities for any resources, not just oil. Those that are independently wealthy do not want the rest of us to have good paying jobs.

I quite agree that most provinces seem quite willing to sell Canada's resources to the highest bidder without the least thought of whether or not there is an alternative policy. However, one or two provinces such as Quebec have shown that they value provincial ownership of key resources, and of course, a very large chunk of Canada is still under federal jurisdiction, not to mention that any resource exported can be subjected to federal approval. The recent refusal of the Harper government to allow foreign takeover of Saskatchewan's potash industry shows that the federal government can step in when it wants. There is a similar situation regarding Nexen where the federal government could also insist on Canadian ownership. The thing is thart Canada is such a huge storehouse of wealth that it is still not too late to institute a pro-Canada policy. However, I expect that such a policy is extremely unlikely given the past history of Canadian governments.

 

[Machjo]

I don't disagree with your suggestion on this; however, the comment on selling the resources at a higher price is measured in relative terms. The reserves are only worth what the commodity price is at any given time (and futures markets). That said, back in the day when WTI was selling for $30/bbl, the gvt nay get a strong price, but it pales in comparison to when WTI is $100/bbl.

The royalty structure imposed by gvts corrects for this, but in the end, the E&P companies look specifically at the economics and the companies will go to those jurisdictions where their returns are strongest.

In the end, the gvts have to balance the present and future values of the money they stand to collect and if they can deploy those funds on an effective basis, they (the community) will win

Considering that crown resources are government property, it's free to sell at the price it wants.

To take an ****ogy: Let's suppose I own a house worth 100,000 CAD on the market, and am not too eager to sell it but would do so at 150,000 CAD. What would be stopping me from putting that house permanently on the market without wasting any advertising money, essentially saying if anyone approaches me to offer 150.000 cad, then I'll sell it. This means I'll likely sell far fewer houses, but the ones I do sell I'll get a really good deal on.

Now one difference between houses and non-renewable resources is that I could always build more houses (so it might make more sense to sell the house at market price and just build another, unless the price really egets too cheap in which case I might decide to stopp selling until the price goes up again), but I can't just produce more gas. What's in the ground is what's in the ground. For that reason, we shouldn't be too eager to sell taht. we should ask for a higher price than market price and then sell however much people are willing to buy at that price. If we could just mass-produce gas cheaply, it might be a different matter, but when it's non-renewable, no.

Maybe if you live in the city and have taxpayer subsidized transportation or collect a government cheque. The rest of us require oil to get to work and to produce our products/services.
Carbon taxes and Cap/trade are wealth redistribution scams.

Even in the city you're groceries must come in by truck, which pass the cost on to the consumer. As for public transit, I agree they should not be subsidized.

remember too though that if the government makes more money off of resources, then it can also lower income taxes as a form of tax shifting. So prices go up, but we have more dispoable incoe to compensate.

 

[taxslave]

I quite agree that most provinces seem quite willing to sell Canada's resources to the highest bidder without the least thought of whether or not there is an alternative policy. However, one or two provinces such as Quebec have shown that they value provincial ownership of key resources, and of course, a very large chunk of Canada is still under federal jurisdiction, not to mention that any resource exported can be subjected to federal approval. The recent refusal of the Harper government to allow foreign takeover of Saskatchewan's potash industry shows that the federal government can step in when it wants. There is a similar situation regarding Nexen where the federal government could also insist on Canadian ownership. The thing is thart Canada is such a huge storehouse of wealth that it is still not too late to institute a pro-Canada policy. However, I expect that such a policy is extremely unlikely given the past history of Canadian governments.

Still leaves us with the unresolved problem of NIMBYism when it comes to building any kind of a processing facility.

 

[Machjo]

I quite agree that most provinces seem quite willing to sell Canada's resources to the highest bidder without the least thought of whether or not there is an alternative policy. However, one or two provinces such as Quebec have shown that they value provincial ownership of key resources, and of course, a very large chunk of Canada is still under federal jurisdiction, not to mention that any resource exported can be subjected to federal approval. The recent refusal of the Harper government to allow foreign takeover of Saskatchewan's potash industry shows that the federal government can step in when it wants. There is a similar situation regarding Nexen where the federal government could also insist on Canadian ownership. The thing is thart Canada is such a huge storehouse of wealth that it is still not too late to institute a pro-Canada policy. However, I expect that such a policy is extremely unlikely given the past history of Canadian governments.

I personally would not mind rewriting the constitution to make it federal, but until then I don't see how banning exports of the resource helps anything if provinces are selling it at rock bottom prices. They're likely to drop the price even further, thus making matters worse.

 

[captain morgan]

Considering that crown resources are government property, it's free to sell at the price it wants.

The market will determine what the price is

To take an ****ogy: Let's suppose I own a house worth 100,000 CAD on the market, and am not too eager to sell it but would do so at 150,000 CAD. What would be stopping me from putting that house permanently on the market without wasting any advertising money, essentially saying if anyone approaches me to offer 150.000 cad, then I'll sell it. This means I'll likely sell far fewer houses, but the ones I do sell I'll get a really good deal on.

Let's expand on your a n a l o g y; Suppose that you rely on the income generated from the sale of the house to operate your business (ie. gvt).. Holding onto that house until the price reaches your goal will not pay the bills in the meantime.

Also, factor-in that you are not the only home builder in town. In this case, gvts will be competing with other jurisdictions in teh development of their resources and the evaluation extends farther than just the cost of the resource, taxes, the cost of living (ie doing business), wages and regulatory environments are also strong considerations.

 

[Machjo]

The market will determine what the price is



Let's expand on your a n a l o g y; Suppose that you rely on the income generated from the sale of the house to operate your business (ie. gvt).. Holding onto that house until the price reaches your goal will not pay the bills in the meantime.

Also, factor-in that you are not the only home builder in town. In this case, gvts will be competing with other jurisdictions in teh development of their resources and the evaluation extends farther than just the cost of the resource, taxes, the cost of living (ie doing business), wages and regulatory environments are also strong considerations.

But here you're assuming the house must be sold. We can survive without selling as much in crown resources. Indeed the world price of resources would go up, but so be it. It would be better for that price to go up slowly now than suddenly once we're scraping the bottim of teh barrel.

 

[captain morgan]

But here you're assuming the house must be sold.

IF you build the house with the purpose of selling it (to fund gvt programs), then yes; the house must be sold at some point. Further, you must consider the present value of that money relative to the future value. Chances are that as the commodity price rises, the CPI and cost of living rise as well - meaning thatthe future money will buy less goods and services

We can survive without selling as much in crown resources.

From what I recall, AB and Sask are the only 2 provinces without (massive) debt... One might argue that you can't survive the medium and long terms (depending on what society demands in freebies, infrastructure, etc of course)

Indeed the world price of resources would go up, but so be it. It would be better for that price to go up slowly now than suddenly once we're scraping the bottim of teh barrel.

Believe me Machjo, there is no global oil shortage. Granted, if Canada were to halt all oil production tomorrow, there would be a drop in the supply and that would impact the markets on the short term, but the market would/will adapt and adjust accordingly

 

[china]

Machjo ,

And we could save 2.4 billion dollars here, or at least 1.5 billion as a conservative estimate:

Federal and provincial bilingualism requirements cost Canadian taxpayers $2.4 billion annually; provinces spend $900 million to provide dual-language services | Fraser Institute
[/QUOTE]

Canada needs a dose of a "common sense " ....very urgently .

 

[taxslave]

But here you're assuming the house must be sold. We can survive without selling as much in crown resources. Indeed the world price of resources would go up, but so be it. It would be better for that price to go up slowly now than suddenly once we're scraping the bottim of teh barrel.

And what about all the many thousands of jobs that depend on resource extraction? Should they all just start selling wildflowers downtown?