Gillard not backing down on mining tax

Prime Minister Julia Gillard has shot down Bob Brown’s call for changes to the mining tax amid indications that key independents can be depended on for support.

Yesterday the Greens leader said more mining ownership and investment should remain in Australia to create a sovereign wealth fund and fund assistance to industries suffering at the hands of the mining boom.

He claimed research commissioned by the party showed 83 per cent of Australian mines are foreign owned, and $50 million in earnings will go offshore under the tax.

The Greens will increase the number of representatives in the Senate from five to nine tomorrow, giving it the balance of power.

But with the support of key independents, Gillard is determined to pass the tax in its current form.

”I’ll be delivering the minerals resource rent tax I shaped in my early days as Prime Minister,” she said.

Key independents Tony Windsor, Rob Oakeshott and Andrew Wilkie have indicated they have not decided on their stance yet.

Windsor said he was supported some level of mining tax, but with most companies making ”absolutely massive profits”, he would consider the proposal by the Greens.

”I’m interested in having a look at what he’s talking about,” Windsor said.

”I wasn’t terribly opposed to a super profits tax,” he said.

Wilkie said he is worried about Labor’s tax only covering iron ore and coal, and said small miners were excluded from last year’s negotiations between the government and the three big miners.

Brown has called for the tax to extend to include gold and uranium.

Claims that the tax will benefit Rio Tinto, BHP Billiton and Xstrata have been made since the new draft legislation was announced.

Fortescue Metals Group’s Andrew “Twiggy” Forrest has taken his battle against the tax “designed by BHP” to federal politicians and has threatened to take it to the High Court if talks are unsuccessful.

”Before I can support it, I will need to be convinced that the settings are right and that it addresses the lingering concerns of smaller mining companies,” Wilkie said.

Oakeshott also said his mind was not made up.

 The Association of Mining and Exploration Companies this morning welcomed a report released by Senator Mathias Cormann scrutinising the mining tax.

The report, released this morning at the AMEC convention, condemns the way the tax was devised and describes the poor process under which it was made.

The report states the proposed MRRT is a dagger at the heart of Australia’s prosperity.

Simon Bennison, AMEC CEO said in a statement that the report correctly outlines how the tax will damage the industry.

“AMEC supports the report, in particular that the MRRT will impose more economic distortions than the existing royalty arrangements,” he said.

“The MRRT raises serious and unresolved constitutional issues which will clearly affect the international competitiveness of emerging companies and further detrimentally impact Australia’s sovereign risk as an attractive place to invest”.

“AMEC fully supports the “Scrutiny of New Taxes” report and calls on the government to scrap the current proposed tax.

“The report confirms AMEC’s longstanding position, that the MRRT is a bad policy and discriminates against emerging iron ore and coal miners.”

“AMEC in particular supports the recommendation in the Senate report that the Parliament should not support this deeply flawed and poorly designed MRRT.”

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