Canada to extend mineral exploration tax credit for 2 more years, minister says

Extension aims to support mining sector’s efforts to raise capital as Canada seeks alternative capital sources to reduce reliance on China

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A nickel plant in Ontario, Canada. Nickel is one of many minerals mined in Canada that are needed for technology manufacturing. Photo: TNS

Published: 4:06am, 3 Mar 2025Updated: 9:13am, 3 Mar 2025

Canada will extend a tax credit on mineral exploration for two additional years as part of the government’s move to support investment in exploration projects, energy, and natural resources, Natural Resources Minister Jonathan Wilkinson said on Sunday.

The mineral exploration tax credit is a capital market tool that offers investors a 15 per cent tax credit to invest in flow-through shares of smaller mining companies. It was set to expire on March 31.

Wilkinson said the extension was to ensure that the mining sector has the tools to raise capital for exploration projects. The move was also an attempt by the government to provide companies with an alternative source of capital to China.

Canada has maintained a tough stance against investments from Chinese state-owned enterprises in domestic mining companies. It has asked at least five companies to divest investments from Chinese state-owned enterprises in Canadian-listed companies.

“There was some degree of anxiety on the part of the sector, especially the juniors [exploration companies], whether it’s going to be renewed,” Wilkinson said in an interview.

The extension was expected to provide C$110 million (US$76.05 million) to support mineral exploration investment, he added.