$12B tax hit on mining profits
MINERS will face a new 40 per cent tax on profits under an overhaul of the country’s taxation system, which Treasurer Wayne Swan said would ensure prosperity was shared fairly.
But the Queensland Resources Council labelled the changes a “tax grab” and warned they could stave off billions of dollars of potential future investment in Queensland.
The overhaul, released yesterday in response to the Henry tax review, will have major implications for the Mackay region with the big miners predicting thousands of future job losses as a result of the tax.
The Resources Super Profits Tax (RSPT) is expected to collect $12 billion in extra revenue from mining companies, to be split between superannuation, infrastructure and businesses. While the miners will be slugged with higher taxes they also will receive $1.2 billion in resource exploration rebates.
The government will begin taxing profits made from the exploitation of non-renewable resources at 40 per cent from July, 2012.
The tax will work in conjunction with the current state royalties system but a refundable credit for royalties paid to state governments will be made available to the mining companies to avoid them paying double tax.
The Minerals Council of Australia, which represents companies including BHP Billiton and Rio Tinto, said the new tax would mean Australia’s mining industry was the highest-taxed in the world.
“We are already punching above our weight in terms of tax take,” chief executive Mitch Hooke said.
Queensland Resources Council chief executive officer Michael Roche said the government needed to implement a package that would ensure Queensland’s resources sector remained globally competitive.
“There’s a strong perception among QRC members that the Federal Government believes the resources sector has a limitless ability to pay more and more tax,” Mr Roche said.
Treasurer Wayne Swan said the RSPT would ensure Australians received a fair share of the profits made from the country’s valuable non-renewable resources.
But Opposition finance spokesperson Andrew Robb said resources companies would go to where they could maximise their returns during the boom.
“ ... if Australian projects are made uncompetitive then there’s every prospect of a lot of these projects being shelved,” Mr Robb said.