A future for flow-through?

"There is a widespread concern that certain of Finance Minister Michael Wilson's Tax Reform proposals will likely lead to a significant decline in flow through funding after 1988. This does not bode well for the junior exploration sector, which relies heavily on flow-through to finance exploration programs. The exploration industry is actively pursuing various solutions to the problems posed by Tax Reform, in order to ensure that flow-through has a future.IntroductionWhile the proposals contained in Finance Minister Michael Wilson's Tax Reform White Paper may not be as far-reaching as some people had expected, nevertheless the combination of the existing tax rules and proposed new rules offers sufficient complexity to keep pencils sharpened for many months. After having had an opportunity to study Tax Reform since June 18, 1987, the sharpened pencils are suggesting that the White Paper is not without its shortcomings and pitfalls. Insofar as the mineral exploration industry is affected, there is widespread concern that adoption of certain Tax Reform proposals could spell near disaster for mineral exploration in Canada. More specifically, there seems to be a consensus among the industry, as well as some federal and provincial government officials, that the announced phase-out of the ""mining exploration depletion allowance"" (MEDA) would reduce the appeal of flow-through shares to the point where only a fraction of exploration funding would be financed in the future by flow-through."