A member of Prime Minister Julia Gillard’s government has asked for changes to the minerals resource rent tax after blaming it for burdening small miners.
WA Labor senator Mark Bishop said the Government should revise the tax to reduce the impact on the small miners whose profits fall below the $75 million eligibility threshold.
His comments come just hours after revenue forecast from the tax were more than halved from $2 billion to $800 million, the SMH reported.
Although they do not pay the tax, small miners still pay compliance costs under rules that compel them to disclose information to the Tax Office if they are profitable enough to qualify for the tax in the future.
In a report compiled after partaking in a recent Senate inquiry into the tax, Bishop said the tax should alter so small miners did not have to file regular, arduous and needless information to the Tax Office.
“It would appear that the elements of the MRRT designed to lessen the burden for smaller miners are not working as intended,” he wrote.
“There is some evidence that smaller miners currently under the $75 million threshold still experience noticeable compliance costs in anticipation of one day exceeding the threshold.
“It is poor public policy to apply a layer of bureaucratic compliance when the relevant companies will never face a tax liability.”
Other than the impact on small miners, Bishop was happy with the performance of the tax.
The Senate Inquiry’s report said the tax should be ‘abolished at the earlier possible opportunity’. Among other criticisms, the Coalition-dominated inquiry also said the ‘failure of the MRRT was entirely predictable’.