Aus­tralian study backs min­ers on new re­sources tax

The Pak Banker - - International -

SYD­NEY: Aus­tralia's ma­jor min­ers scored a vic­tory in their clash with the govern­ment over a con­tro­ver­sial new min­ing tax Tues­day, when an of­fi­cial study backed their stance on the levy.

The tax trig­gered an an­gry back­lash from the nation's most valu­able ex­port in­dus­try when it was first sug­gested in May, and was a key fac­tor in top­pling the then prime min­is­ter Kevin Rudd in a La­bor Party coup the fol­low­ing month. A com­pro­mise agreed be­tween Rudd's suc­ces­sor Ju­lia Gil­lard and BHP Bil­li­ton, Rio Tinto and Xs­trata has since ap­peared shaky af­ter the min­ers ac­cused the govern­ment of reneg­ing on a deal to re­fund all state roy­alty pay­ments.

But the govern­ment-com­mis­sioned re­port into the Min­eral Rent Re­sources Tax (MRRT) sup­ported the min­ers' view, say­ing they should re­ceive tax cred­its for all state min­eral and gas roy­al­ties paid.

"The MRRT should not be used as a mech­a­nism to en­able States and Territories to in­crease in­ef­fi­cient roy­al­ties on MRRT tax­able com­modi­ties," it said. "All cur­rent and fu­ture State and Ter­ri­tory roy­al­ties on coal and iron ore should, there­fore, be cred­ited."

The re­port is at odds with the govern­ment's stance, which sets roy­alty re­bates at their May 2010 level and does not fac­tor in any fu­ture in­creases. Trea­surer Wayne Swan said he would not en­dorse or re­ject any of the rec­om­men­da­tions in the re­port im­me­di­ately, and would re­spond early next year. "But I can say this: there is a lot of com­mon sense in this re­port, a lot of com­mon sense in these rec­om­men­da­tions," he told re­porters in Can­berra.

He said he would work through all 94 rec­om­men­da­tions in the re­port, which said that Aus­tralia's coal and iron ore in­dus­tries needed cer­tainty.

The min­ing tax, set to ap­ply to iron ore and coal from mid-2012, will fund in­fra­struc­ture, pen­sions and tax cuts for small busi­nesses, Swan said.

"This type of re­form is ab­so­lutely crit­i­cal to the fu­ture strength and pros­per­ity of our coun­try," he said. -Afp

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