Policy & Positions Manual
Provincial Issues - Office of the Premier
Leveling the Playing Field for Oil and Gas Service Companies (2010)
British Columbia’s Oil and Gas industry generated the single largest source of revenue to the province in 2008 at $4.09 billion. In fact since 2001, the oil and gas industry has invested almost $38 billion in BC. The Chamber understands that the Province is attracting new investment through innovative infrastructure and royalty programs, and that this has been key to the growth of the industry.
Most exploration companies are based outside of British Columbia. Given north-eastern BC's close proximity to Alberta, and the large number of oil and gas service firms based there, BC-based oil and gas service firms feel great competitive pressure from Alberta-based firms for work that is completed on British Columbia land. The TILMA agreement further enables cross-border work as many regulations have now been streamlined.
With the increased volume of Alberta-based companies coming into BC, the number of Alberta trucks on our roads has increased. These trucks may not meet the BC Ministry of Transportation requirements. And without adequate enforcement these out of province companies may be operating with a competitive advantage.
While the implementation of the HST greatly improves the chances for BC companies to stay competitive, there is risk that out-of-province firms will not remit the full amount of the HST, especially when they are invoicing other out-of-province firms for work performed in BC. In order to ensure a level playing field for BC-Based Oil and Gas companies with their primarily Alberta-based competitors, British Columbia regulations must be enforced at the same standards for both out-of-province firms and BC-based firms. This would include, but not be limited to, Commercial Vehicle Regulations and HST tax collection.
THE CHAMBER RECOMMENDS
That the Provincial Government:
- implement a regulation system to ensure BC regulations are followed by out of province firms conducting work in BC by:
- establishing a very active presence of Commercial Vehicle/Law enforcement on the highways between the Alberta and British Columbia border; and,
- encouraging the Canada Revenue Agency to develop systems to ensure all work performed in BC is invoiced with the full 12% HST regardless of the province or state where the company's offices are located.
