The UCP has announced a massive new incentive programs with the hope of attracting petrochemical companies to Alberta..But the Canadian Taxpayers Federation is slamming the plan, in part, because of its lack of a cap..The province claims the Alberta Petrochemicals Incentive Program (APIP) will help attract billions in petrochemical project investments and continue to diversify the province’s economy while drawing directly on our abundant reserves of natural gas..“The goal is to aggressively compete with several jurisdictions across Asia, the Middle East, and those in the Gulf of Mexico in the United States, many of which also offer similar incentives for petrochemical manufacturers, to become a global destination for petrochemical investment,” the province said in Friday release..“According to Alberta’s Industrial Heartland Association, there is an opportunity to grow Alberta’s petrochemical sector by more than $30 billion by 2030, resulting in more than 90,000 direct and indirect jobs over the construction and operations of new facilities, and more than $10 billion in revenue for the Government of Alberta from corporate and personal income taxes.”.APIP offers a direct financial incentive on new petrochemical or fertilizer facilities, or on expansions to existing ones..Once a project is up and running, companies that have successfully applied will receive grants worth 12 per cent of their eligible capital costs..The grant will be issued in the final step in the process, ensuring that only projects already built and employing Albertans receive funds, said the release.Prior to the grant, companies will need to show their project meets the program requirements by detailing the scope and expected cost of the project..The application window for small projects (between $50 million and $150 million in capital costs) will be open for five years. Applications for larger projects will be open for 10 years..Projects eligible for the program must have a minimum $50 million in capital investment, consume natural gas, natural gas liquids or petrochemical intermediaries, create new and permanent jobs in Alberta and meet the federally set definition of a manufacturing and processing facility..There is no cap to the program, but the government will report on expected costs each fiscal year, based on applications received and projects approved..“Today we’re adding another incentive to Alberta’s already world-class opportunities for petrochemical development. On top of our existing petrochemical producers and all the companies that feed in and support them, we have a multi-generational supply of natural gas, an experienced workforce, and one of the lowest tax rates in North America. By launching this program, Alberta moves towards achieving the goal of becoming one of the most attractive investment opportunities for petrochemicals in the world.,” said Dale Nally, Associate Minister of Natural Gas and Electricity.. POLL: Many Albertans say they will ignore Christmas COVID lockdown .The Canadian Taxpayers Federation is slamming the government for failing to put a cap on the program..“Taxpayers shouldn’t be forced to sign a blank cheque for the petrochemical industry,” said Franco Terrazzano, the CTF’s Alberta Director..“It’s bad enough that taxpayers are already paying for one bad petrochemical subsidy, but it’s completely unacceptable for Premier Jason Kenney to let another petrochemical subsidy to be rolled out without a cap on taxpayer costs.”.The APIP is in addition to the current Petrochemicals Diversification Program, which costs taxpayers $1.1 billion..The CTF obtained a leaked briefing note produced by Treasury Board and Finance officials warning former finance minister Joe Ceci about the risks associated with subsidies for the petrochemical industry, which states: “the proposed incentive program cannot be justified on economic merit alone” and “there is no guarantee that the incentive program will actually lead to additional investment.”.“Kenney deserves credit for lowering the business tax rate so job creators can invest more of their own money into their business, but the government is taking a wrong turn by adding another petrochemical corporate welfare program on to the backs of struggling taxpayers,” said Terrazzano..Dave Naylor is the News Editor of the Western Standard.dnaylor@westernstandardonline.com.TWITTER: Twitter.com/nobby7694
