Australia's MRRT to be discussed

March 24, 2014

Australia’s Minerals Resources Rent Tax is again being discussed in parliament. This time it is bills aiming to repeal the tax coming up as the first order of business for the Senate.

Prime Minister Tony Abbott’s administration supports repealing the tax has called the tax anti-Western Australia. Finance Minister Mathias Corman recently said, “We always said our first two priorities in term of legislation was to scrap the carbon tax and the mining tax.”

The Australian Chamber of Commerce and Industry, the Business Council of Australia and the Minerals Council of Australia, industry representatives also support the repeal and called for the Senate to vote against the MRRT.

In a joint statement, the groups said the tax imposed an unnecessary additional burden on the country’s mining industry, which already pays about $20 billion a year in federal tax and state royalties.

“It also acts as a disincentive to invest in Australia's minerals sector at a time when the industry is facing pressing challenges to improve productivity and cost competitiveness,” the statement said.

Australia’s Greens party has argued again repealing the tax, saying the government should get its share from the minerals being extracted.
Passed by the House in 2011 and the Senate in 2012, the tax is levied on 30 percent of the “super profits” from the mining of iron ore and coal in Australia, with a company mandated to pay the tax when its annual profits reach A$75 million.

Greens Party leader Christine Milne opposed the repeal in the Senate, saying, “Government needs to ensure it gets a fair whack of the resource rents.”

The Labor Party supports the concept of a profit-based mining tax and will consult with state and the mining industry before the next election, said Western Australian Senator Alannah MacTiernan.

Australian Labor Party Senator Doug Cameron declared, “The tax has raised $400 million, and I would rather have $400 million spent in the community than have the mining companies keep ever more profit.”

 

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