Forrest’s Fortescue to fight tax

 Andrew ‘Twiggy’ Forrest is funding a High Court battle against the mining tax.

His decision to support the legal fight comes on the back the Mineral Resources Rent Tax’s (MRRT) introduction into parliament earlier this week.

At the time, Fortescue urged the parliament to "realise the rank unfairness [of the scheme between different members of the same industry] and the failures of the draft bill".

The Government has since accused Forrest of just not wanting to pay a tax, whereas Forrest says he is standing up for junior miners who would be strong armed into supporting the budget because of Treasury mistakes, according to The West Australian.

He said Fortescue will actually be paying less tax than many of its junior counterparts, adding that "we cannot have an unfair tax.

"Being ill conceived, poorly negotiated by Government and finalised in a shroud of secrecy and exclusiveness with the world’s biggest mining companies, this tax is unfair and a penalty on smaller mining companies."

Research by BDO shows that both Rio Tinto and BHP are unlikely to pay any taxes under the MRRT for at least half a decade.

It states that it is due to the large investments the miners made in their operations, which can be used to offset their liabilities.

"To ensure at least some transparency, the Government must release the assumptions and financial modelling it has used to estimate forecast revenue from the MRRT. In its present form, the bulk of the tax revenue will only come from the junior mining sector.”

The current structure of the MRRT allows the largest mining companies a deduction on their overall MRRT tax liability, based on either the book value or market value of their separate relevant coal and iron ore projects as of May last year. 

"I think we’ve seen the track record of this Government when they have not thought through their policies," Forrest told The West.

"They’ve turned to the High Court, the High Court has turned that down. There has to be a very real option."

 

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