Balancing The Books: Our recommendations to Yukon government
With the prospect of future budget deficits in the coming years, The Yukon government wants to get a handle on their books. In September a financial advisory panel delivered their recommendations on how to do just that. You can read the full report here. The public input period just closed, and the government is now working on a final plan that’s slated to be released in November.
Here are our recommendations to the government.
• Modernize the royalty for placer gold, which hasn’t been updated in a century when the price of gold set at $15 per ounce. The value of gold is currently at about $1,600 an ounce. If we were to use today’s gold value in our royalty calculations, our current 2.5% rate would bring the Yukon around two million per year in new revenue.
•Increase the one-time payment ($10) of registering a mining claim, and the amount of work (or payment in lieu of work) required to be done on each claim annually. This would discourage people from sitting on claims they don’t intend to develop, encouraging more thoughtful staking and reducing liability to government.
• Remove the fuel tax exemption for off-road vehicles used by industry, especially as new mines open in the territory. This would encourage mines to move to less carbon intensive options, an added bonus at a time when Yukon is looking to minimize our greenhouse gas emissions. It would also remove their advantage over other transport-intensive industries, like retail and construction.
•Establish a payroll tax for out-of-territory workers to address the fly-in, fly-out population of the work force who currently deliver their income taxes to non-Yukon government coffers.
Subsidies and Infrastructure Spending
• Complete a full cost/benefit analysis before going forward with major projects. The recent joint federal and territorial announcement to invest $360 million into roads that will service mines leaves unanswered questions: how much will the territory benefit in terms of tax and royalty revenues? How many new long-term jobs will be created, beyond those that were directly funded by taxpayers?
•Stop subsidizing the use of oil and gas, including propane. Since Yukon currently does not produce oil or gas, there are no benefits flowing to Yukon from these subsidies.
The Non-Profit Sector
• Support successful non-governmental organizations (NGOs) instead of attempting to duplicate their work. The cost for NGO’s to run programs is often significantly less than what it would cost for government to do the same.
• Create one clear set of NGO funding rules across departments. There is no consistency in terms of how each department – or even each fund – manages applications, selection, reporting or spending. Centralized oversight would provide consistency and clear expectations.