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

taxslave

taxslave

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tay said:
Alberta should adopt a sales tax, according to the latest press release from the Fraser Institute.




But don’t worry, the latest piece of far-right puffery from the market-fundamentalist “think tank” – which prefers to refer to this bumpf as a “study” or a “report” – only advocates a consumption tax like those in Texas and Wyoming so that income and business taxes can be eliminated for the very rich people who bankroll the legal charity to the tune of $11 million a year.


Both of those known-to-be-enlightened states have eliminated income taxes and taxes on businesses in favour of sales taxes, the Fraser Institute says, so we Albertans should hurry up and do the same thing.


Just thought I’d start with this point because there’s bound to be plenty of uncritical media coverage of the Fraser Institute’s “findings” in the morning that fails to mention it.


Indeed, the Edmonton Journal was Ifirst out the gate with just such a report, complete with the predicted omission. It did, however, gloomily proclaim that “Alberta’s finances are in worse shape than other energy-producing provinces and states,” while quoting Progressive Conservative spokespeople who meekly accepted many of the Fraser Institute’s dubious claims while maintaining they’ve already done much of what the group demanded.


The Fraser Institute’s media statement about its conclusions emphasized, however, that Alberta’s recent deficits were not caused by “lack of revenues” – a point that is contentious to say the least given that Alberta taxpayers, as the province’s resource royalty review stated, in 2007, “do not receive their fair share from energy development and they have not, in fact, been receiving their fair share for some time.”


The government of premier Ed Stelmach timorously implemented some of the independent government panel’s recommendations, and then ran screaming from what it had done in 2010 when resource companies threatened a capital strike and began seriously funding the market-fundamentalist Wildrose Party.


That retreat got Alberta back in the race to the bottom advocated by groups like the Fraser Institute. Speaking of which, in fairness to the organization, its “study” released yesterday barely deals with the important question of resource royalties, which is only mentioned once, in passing, in its 66 pages. Nor is this the effort’s only significant oversight.


Quite naturally given that omission, this latest pronouncement from the group reaches conclusions other than that a modest increase in oil revenues might be part of the solution to the province’s budgeting conundrum. No, no, it’s all about too much spending!


Moreover, the Fraser Institute’s North American focus is highly convenient – and obviously quite intentional – because it effectively allows the authors to concentrate on low-tax jurisdictions with mostly smaller energy sectors in which many other economic factors are at play. This lets their “research” jostle the pinball machine in favour of the group’s predetermined conclusions.




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You could drive one of those tar sands heavy haulers through the gaping holes in the latest Fraser Institute ‘study’ of Alberta’s finances | Alberta Diary
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Actually anyone with any understanding of economics at all would agree with this.
To start with business does not really pay any tax. Never have and never will. All they are is an expensive conduit to get consumer's money to the government. For a business to Pay tax it must first earn money. This money of course is taken from the consumer. So the higher the business "tax" the higher the retail price of a product.

Resource royalities is a whole nother kettle of fish and should only be charged on exported products, otherwise we effectively pay tax on a tax.
 
petros

petros

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Resource royalities is a whole nother kettle of fish and should only be charged on exported products, otherwise we effectively pay tax on a tax.
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You have that backwards. Royalties go straight to GoC coffers. Without them you'd be taxed higher to make it up.

If you want something beneficial, axe the GST on fuel.
 
taxslave

taxslave

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petros said:
You have that backwards. Royalties go straight to GoC coffers. Without them you'd be taxed higher to make it up.

If you want something beneficial, axe the GST on fuel.
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The cost of royalities is just passed on to the comsumer. It does not come out of the business. I think oil royalities go to the province, same as timber.

The important fact everyone is forgetting here is that Norway exports oil it pumps out of the ocean floor while our lefties want all the goodies from oil revenues but protest the building of pipelines.
 
petros

petros

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taxslave said:
The cost of royalities is just passed on to the comsumer. It does not come out of the business. I think oil royalities go to the province, same as timber.

The important fact everyone is forgetting here is that Norway exports oil it pumps out of the ocean floor while our lefties want all the goodies from oil revenues but protest the building of pipelines.
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There are both federal and provincial royalties and no it's not passed on to the consumer.
 
captain morgan

captain morgan

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taxslave said:
It sure isnt absorbed by the iol companies. It is a cost of doing business and is ultimately paid for in retail prices.
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The market determines the price of a bbl and the producers respond to that price accordingly.

The royalties are paid regardless of that price so there is really no way that an upstream producer can recoup that cost.. On the downstream side (at the gas station) those companies that are active in production and distribution can mitigate those costs but not by that much
 
petros

petros

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captain morgan said:
The market determines the price of a bbl and the producers respond to that price accordingly.

The royalties are paid regardless of that price so there is really no way that an upstream producer can recoup that cost.. On the downstream side (at the gas station) those companies that are active in production and distribution can mitigate those costs but not by that much
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It's a conspiracy.

bill barilko said:
Apropos of nothing roughly how much royalty per barrel is paid to the Provincial & Federal gubmint-anyone know?

Percentage or dollar figure is fine-just wondering
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Look it up and you WILL find the rates for fed and each producing province.
 
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