Min­ing tax re­view a hard sell for govt

Townsville Bulletin - - National Snapshot -

THE Fed­eral Gov­ern­ment is on a col­li­sion course with the states over min­ing roy­al­ties and may strug­gle to se­cure Green votes to get its re­sources tax through par­lia­ment. Laws to im­ple­ment the tax will be in­tro­duced to par­lia­ment later this year, with the tax due to be­gin in July 2012.

Trea­surer Wayne Swan an­nounced yes­ter­day all 98 rec­om­men­da­tions of the Ar­gus re­view of the Min­eral Re­sources Rent Tax ( MRRT) had been ac­cepted. The gov­ern­ment will now credit min­ing com­pa­nies the full amount they pay in stateim­posed roy­al­ties.

This will slash the level of funds the gov­ern­ment reaps from the MRRT – pre­dicted to be $ 7.4 bil­lion in the first two years – if states in­crease their roy­al­ties.

While the gov­ern­ment won’t leg­is­late to cap the states’ roy­al­ties, Mr Swan in­di­cated there was a range of mech­a­nisms to pre­vent any hikes, in­clud­ing pos­si­ble changes to GST pay­ments.

‘‘ I don’t an­tic­i­pate as we go through this any great ker­fuf­fle,’’ he told re­porters.

‘‘ So I’m not tele­graph­ing any par­tic­u­lar mea­sure that we would take.’’

Prime Min­is­ter Ju­lia Gil­lard struck an agree­ment on the min­ing tax with min­ing gi­ants BHP Bil­li­ton, Rio Tinto and Xs­trata last year soon af­ter she re­placed Kevin Rudd.

The new tax ap­plies to coal and iron ore min­ers.

The real test for the Gov­ern­ment will be to garner the sup­port of the Greens and key i nde­pen­dents, whose sup­port is vi­tal for the leg­is­la­tion to pass.

Mr Swan urged the Op­po­si­tion, the Greens and inde- pen­dents to back the tax or pay the price in their elec­torates.

‘‘ Think about this, the min­ing in­dus­try, as rep­re­sented by the great bulk of those that are min­ing our min­eral wealth, have agreed with the Aus­tralian gov­ern­ment that this is a tax that’s worth pay­ing,’’ he said.

Greens leader Bob Brown, whose party will hold the bal­ance of power in the Se­nate from July, said fully cred­it­ing min­ing com­pa­nies with state roy­al­ties into the fu­ture al­lowed big min­ers to get off scot-free.

‘ ‘ Com­pared with Trea­sury’s orig­i­nal ad­vice, Aus­tralian tax­pay­ers are go­ing to miss out on more than $ 100 bil­lion worth of ed­u­ca­tion, health ser­vices and infras t r uc­ture s pend­ing,’’ Mr Brown said.

‘‘ We may end up with the fed­eral tax­payer sub­si­dis­ing the states.’’

The tax would chan­nel $ 6 bil­lion of in­fra­struc­ture spend­ing to the re­gions na­tion­ally. West­ern Aus­tralia and Queens­land stand to get at least $ 2 bil­lion each for road, rail, port and other crit­i­cal in­fra­struc­ture.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.