,

HOT TIME FOR U.S. AMBASSADOR IN VICTORIA. Young protesters carrying sign reading:
Vietnam - Hands off Canada,” dog steps of U.S. ambassador Harold Linder (centre) and Milton Rewinkel,
.S. consul-general of Vancouver, at legislative buildings recently.
“ambassador and his companion to take refuge in a cabinet minister's office.

FRIDAY, MAY 2, 1969

The 25 demonstrators forced the

'

“Hands off

Tribune

al

VOL. 30, NO. 18

$650 MILLION TAX
GIFT TO MINE COs

shana

Income tax bonanza
for big monopolies

By MAURICE RUSH

How would you feel if the federal government
suddenly announced that for the next few years working
people will enjoy an income tax deduction that will save

them $650 million?

Don’t hold your breath until it

happens to you - but it has been happening for years toa
handful of the largest mining monopolies in Canada.

Last week Canada’s assistant
deputy minister of mineral
development, J.P. Drole, said in
a statement before a Commons
committee that the federal tax
exemption enjoyed by new mines
for the first three years of their
operation has amounted to an
average saving of $50 million a
year

The tax exemption has been in
effect since 1955. Drolet’s
disclosure that it has saved the
mining industry $50 million each
year means that in the 13-year
period — up to 1968 — the
Canadian public have subsidized
the mining companies to the tune
of $650 million!

This outright gift from the
public treasury did not go to the
whole mining industry.
According to Drolet, the yearly
average of $50 million was

By NIGEL MORGAN
__ The wage movement in
BC. is reaching a new
tage. In what was
Considered ‘‘an_ off-year
Or negotiations’ in this
) a major
is devel

‘Sustained, sharp increases in
OMpany earnings, prices, taxes,
Ntals, mortgage and interest
Manges are creating an
Xplosive situation in manage-
hent-labor relations.

And while escalating living
ts have cut deeply into the
Checks of working people
t to mention what they have
to the purchasing power of
Mers, and particularly

pensioners and those on fixed
incomes) company profits have
risen to unprecedented heights.
For example, today’s press
headlines: ‘‘MacMillan-Bloedel
Profits Up 39 Per. Cent’’
reaching $10,238,469 for the first
quarter of 1969. The Province
report says despite the fact that
“January and most of February

saw the severest working
conditions experienced in B.C.
for many decades,’ with

operating profits in January as a
consequence the lowest ever
experienced by the Company,
“improved prices resulted in

March recording the highest
operating profit in the
Company's history.”’

The two other B.C. lumber

giants did even better. The U.S.
Crown Zellerback Corporation

reported a 63% increase in net
profits for the first quarter
compared with last year, and
B.C. Forest Products a cool 70%.

MILITANCY GROWS

Lumber prices are being
increased almost daily. Last
month they rose by 9.6% alone
(while B.C. woodworkers wages
were limited to 642% raise over
a 12-month period),

Unprecedented prices and
profits for the monopoly
interests, while woodworkers
(like the rest of us) are
victimized by skyrocketing
living costs. A recent Trade
Union Research Bureau survey
estimates workers need a 7%
wage hoist just to keep pace with
the increased cost-of-living and
increased deductions for

Income Tax, Unemployment
Insurance and Canada Pension
Plan.

The sudden heating-up of the
primary contradiction of our
time — the clash of class
interests between those who own
for a living, and whose who work
for a living, is producing a
noticeable rise in radicalization
of the working class. This is
reflected in:

e The sustained rank and file
initiative and militancy;
growing number of ‘‘wildcat”’
strikes. (Vancouver Island
fallers, Alberni sawmill, and
shingle weavers, etc. )

© Persistent demands for the
reopening of agreements for
upward revision of wages.

See WAGE, pg. 12

usually divided among 15 giant
corporations. Many of the
individual exemptions amounted
to several million dollars a year
and, he added, ‘‘rarely did the
exemption mean a gain of less
than $500,000 to the owners of
new mines.”

The Carter Commission Re-

port on Taxation, which is
gathering dust in Ottawa,
recommended that this tax

exemption be abolished. ‘‘The
small corporations obtain little if
any direct benefit from this
concession, which favors most of
those corporations which need it
least,’’ said the report.

The Carter Commission report
painted a picture of even fewer
monopolies getting all the gravy
than does deputy minister of
mineral resources Drole.
According to the report, ‘during
the period 1955 to 1964, five large
mining companies reported
about 70 percent of the income
exempted under the new mine
provision.”’

An example of how this tax
doesn’t — as is claimed— attract
“risk capital’’ to mining, but is a
direct public subsidy to the giant
capitalist enterprises, is shown
by the Pine Point Mine in the
North West Territories.

Owned by CM&S, which is in
turn controlled by Canadian
Pacific Investments, which is in
turn controlled by the CPR, the
federal government had_ the
CNR, build a special rail line ata
cost of many millions of dollars
to Pine Point to ship unrefined
lead and zine concentrates to the
U.S. and Japan,

Starting up in 1965 under the
tax exemption, the highest grade
ores were stripped off in the first
three years of operation, netting
the company a profit of $94.5
million tax free.

Under present income tax
regulations mining companies

See TAX GIFT, pg. 12