Mining Tax of Significant Concern for Industry in Grey
Posted on Wednesday, 23 November, 2011
After a marathon sitting of Parliament last night, the Labor Government’s Minerals Resource Rent Tax (MRRT) passed through the House of Representatives, with current and future local miners to be significantly affected Federal Member for Grey Rowan Ramsey said today.
“While I recognise a large number of Australians believe miners should pay more tax, I have serious concerns around the structure of this tax and its fundamental inequity for mining companies and industry,” he said.
“There are enormous inconsistencies in the tax, after all why tax coal, iron ore and petroleum but not the copper, uranium or bauxite”?
In the immediate term Mr Ramsey said the tax would certainly impact badly on OneSteel.
“At a time when the Whyalla operation is already under review and fighting for its survival in three weeks the Government has inflicted both a carbon tax and a mining tax,” Mr Ramsey said.
“Both will siphon tens of millions out of the business. It simply doesn’t make sense.”
“The tax has been negotiated with just the three biggest miners in Australia. OneSteel admitted this week it was too early access the impact of the tax on their business. This is after more than two years negotiation! Clearly they have been shut out the room and the Government has been concentrating on the three miners and the demands of the Greens. It seems every decision the government makes is a concession to the Greens.”
Mr Ramsey said the structure of the tax gives the States the green-light to raise royalties, because the Federal Government refunds the royalties to the miners.
“This means the tax will be eroded and lead to confrontation with the states as they raise royalties and the Government claws back the increases by slashing GST revenues,” he said.
“Additionally there is enormous volatility in the tax. The Government’s receipts are totally at the mercy of the market.
“A range of start-up miners are trying to establish new iron mines on Eyre Peninsula, the Far North in the Woomera area and to the east near Broken Hill. All are redoing the sums on their viability in the light of both the carbon and mining taxes”.
Media Contact: Leonie Lloyd-Smith 02 6277 4967
November 23, 2011