Thursday, May 5, 2011

Weird Election; Weird Budget

One of the after effects of the Conservative majority is that their budget will ultimately be passed into law. The flow-through donation shelter, as we knew it, is gone.  

Taking away the capital gain exemption on a gift of marketable securities (mining flow-through shares) increases the cost of donation significantly. In Quebec, however, there is a capital gains exemption on a disposition of strategic investment shares and so the negative repercussions of the budget are only half felt in Quebec.  

As a result, we have started to see Quebec mining flow-throughs being marketed here in Montreal where the end cost of the donation is 15%. Quebec promoters are hoping to meet with Quebec Finance to confirm the tax treatment. We will keep you informed.


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