$100m exploration boost
JUNIOR exploration companies have received a $100 million commitment from the Federal Government to help drive exploration activity in Australia.
The funding will be provided as tax incentives for mining juniors to encourage investment and risk in their exploration activities.
Under the new Junior Mineral Exploration Tax Credit scheme (JMETC), Australian resident investors of junior explorer companies will receive a tax credit where the exploration company chooses to give up a portion of their losses relating to greenfields exploration spending in an income year.
Prime Minister Malcolm Turnbull said the scheme was focused on promoting investment and driving economic activity in the resources sector.
“These tax incentives will encourage ‘junior explorers’ to take risks and to have a go at discovering the next large-scale mineral deposit,” Mr Turnbull said.
“We want to back enterprise. We want to turn around the greenfields minerals exploration expenditure that has declined by almost 70 per cent over the past five years.”
The Government said the ability to immediately distribute tax credits to investors would make investing in a ‘junior explorer’ more immediately attractive and encourage investment in
“We want to turn around the greenfields minerals exploration expenditure that has declined by almost 70 per cent over the past five years.”
small companies undertaking greenfields exploration.
Resources and Northern Australia minister Barnaby Joyce said greenfields mineral exploration was a catalyst for new investment opportunities and job creation which supported local businesses in regional communities across Australia.
“Despite good prospects Australia has not had a world-class mineral discovery in more than twenty years,” Mr Joyce said.
“This credit will make it more financially attractive for our mineral explorers to find resources in untapped regions.”
The government said only newly issued shares relating to capital raising for investment in new greenfields exploration activity would be eligible for the tax credits to help maximise the incentive for additional investment.
Tax credits of up to $100m over four years will be available from this financial year, on a first-in, first-served basis consistent with arrangements to be administered by the Australian Taxation Office.