The Provincial Government continues to show its commitment to creating business opportunities in Newfoundland and Labrador with the announcement of a 45 per cent resort property investment tax credit designed to encourage individuals and corporations based in the province to invest in selected tourist resort properties.

The tax credit is geared towards encouraging new resort developments with high-end amenities and services in areas of the province outside the northeast Avalon Peninsula. It is specifically designed for individuals and corporations in Newfoundland and Labrador to invest in the tourism industry in the province.

"The new resort property investment tax credit sends a clear message to potential developers from the international marketplace. We have confidence in our tourism product, and are eager to partner with industry players to continue to grow the tourism business base," said the Honourable Kevin O�Brien, Minister of Business. "Our government will continue to make strategic investments in this industry, to diversify our economy, and to invest in rural areas that offer so much to our visitors, to create a stronger and self-reliant Newfoundland and Labrador. One of our Bluebook commitments was to use strategic tax incentives to spearhead new economic development activities, and this announcement is doing just that."

The 2004 Newfoundland and Labrador Tourist Product Development Strategy - A Special Place, A Special People, The Future for Newfoundland and Labrador Tourism - indicated that a demand exists for multi-seasonal tourism properties with a minimum of 50 units and a rating of three stars or better. This identifies an opportunity to grow and enhance the tourism accommodations base in Newfoundland and Labrador.

"The findings in the 2004 report identified a gap in supply to meet the growing demand of our expanding tourism industry," said the Honourable Tom Hedderson, Minister of Tourism, Culture and Recreation. "The new tax credit is designed to address this issue of supply and demand, which will help us further develop a tourism industry that generates $820 million in annual revenue and employs 47,000 people directly and indirectly."

When developing the new resort property tax credit, the best practices of a similar tax credit implemented by Ireland were carefully reviewed. Ireland implemented tax credits for tourist centres, enabling the country to build a tourism industry to a point where millions of tourists visit the country during every season of the year.

"The new resort property tax credit will encourage developers to build first class tourism facilities throughout the province," said the Honourable Tom Marshall, Minister of Finance. "As a result, a greater number of tourists will have an opportunity to experience the breathtaking scenery and unwavering hospitality in more areas of the province, particularly in rural regions. The tax credit, along with the unprecedented tax measures and economic development initiatives contained in Budget 2007, will assist our government to build a stronger, more diversified economy and transition toward being less reliant on revenues from our non-renewable resources."

To enable the resort property investment tax credit, amendments will be proposed to the province�s Income Tax Act in the House of Assembly this session. The proposed amendments will authorize the Provincial Government to proceed with regulations surrounding the new tax credit.

A new developer to the province, Humber Seasons Limited, is poised to be the first development company to participate in the new resort property tax credit. The company is in the initial phases of developing a four-season, high-end tourism complex located in Steady Brook, on the west coast of the province.

Humber Seasons Limited is a direct example of how the tax credit will support rural areas of Newfoundland and Labrador. It also demonstrates the Provincial Government�s continued commitment to rural development, specifically through the province�s tourism industry.

"As a developer, we recognize the potential in Newfoundland and Labrador," said Frank Kelly, president and CEO of Humber Seasons Limited. "Though we are still in the early stages of our development, we are very confident the new tax credit will positively influence the viability and success of our project. We are very excited regarding our proposed development."

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In order for a development to qualify for the resort property investment tax credit, a number of qualifications must be met. These qualifications include:

2007 06 01                                                         11:30 a.m.