Delays in Implementing New Brunswick’s Higher Timber Royalties Saved Forest Companies Millions
Delays by New Brunswick’s provincial government in setting up higher timber royalties last summer to take advantage of elevated lumber prices helped forest companies avoid millions of dollars in extra charges on wood they were cutting on public land at the time, according to reporting by CBC New Brunswick (3-23-23).
Budget figures released last week show forest companies are likely to pay $92.8 million (CAD) in timber royalties by the time the current fiscal year ends on March 31st. While that’s a record amount, it is still well below the $118.1 million the government was originally suggesting the higher fees would bring in when they were announced last spring, CBC reported.
After deciding to raise timber royalties in May 2022, the province spent most of June working out how high they should be raised. Then came the required 60-day waiting period in July and August prior to the new fees being imposed. CBC estimates that the delay helped save forest companies about $1 million per week in higher royalty fees.
Jayson Hoyt, a communications officer with the New Brunswick Department of Natural Resources and Energy Development, told CBC that “The Crown Lands and Forest Acts does not allow retroactive charges to rate. Therefore, timber that was harvested before September was charged the older royalty rate.”
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