Founders: Why Canada’s Mining Proposal is “Transformative”

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit vblgoldfix.substack.com/subscribe Founders Housekeeping: Due to spotty connectivity No Founders discussion today Canada is proposing a permanent 100% first-year write-off for much of miners’ capital spending, and GoldFix sees the same capex incentive that helped ignite America’s AI investment cycle now being applied to mining. TL;DR * Canada is proposing permanent first-year expensing for most new depreciable assets and Canadian development expenses. Finance Canada says about two-thirds of capital investment would qualify, at an estimated federal cost of $36 billion over five years. The government’s marginal effective tax rate estimate falls from 13.0% to 6.4% under the proposal. Canada * Mining gets a direct benefit. The Mining Association of Canada says immediate deductions for mine equipment, infrastructure and development spending will improve cash flow and project net present values and could move marginal mine expansions across internal investment thresholds. The Mining Association of Canada * The central analogy is U.S. capex policy. The One Big Beautiful Bill made 100% first-year depreciation permanent for qualifying U.S. property acquired after January 19, 2025. The GoldFix thesis is that Canada is now creating a similar incentive for capital-intensive mining investment. IRS * The early beneficiaries should be the miners that already have cash. We favor larger Canadian miners with strong free cash flow and balance sheets. More speculative companies may participate later by raising equity or debt, but that is a second-stage trade rather than the initial one. REMINDER: FOUNDERS SUNDAY DISCUSSION RETURNS NEXT WEEK BONUS BELOW