The mining tax is “set to become even more chaotic after the Treasurer indicated that new changes are in store,” shadow minister for resources Ian Macfarlane says.
It comes as the government gathers in Canberra for a tax forum to discuss recommendations from the Henry Review.
One of the major issues that mining companies have with the tax is whether the government will reimburse them for any increase in state royalties, a question that is yet to be answered.
“Wayne Swan today said the Government would ‘deal with that in time’ on the question of the Commonwealth reimbursing mining companies for increases in State Government royalties,” Macfarlane said.
“Current arrangements including company tax on profits and state based royalties on production are much simpler and fairer,” shadow minister for financial services Mathias Cormann stated.
“Yet just two days ago Martin Ferguson insisted that the mining tax deal was ‘dusted and settled’ and that there would be no more alterations,” Macfarlane added.
Ferguson’s comments followed the Greens call to include gold under the mining tax, with the minister stating they can forget it, adding the issue of the tax is settled, following its second draft exposure to the public.
“The MRRT is a mess. It’s little wonder the Government is now frantic to fix the gaping holes in the tax design created by Julia Gillard’s desperation to do a deal with the big three miners and get the tax debacle off the table before last year’s election,” Macfarlane stated.
He went on to say that the Government claims to have ruled out caving in to the Greens’ demands that gold be included in the MRRT and that the tax rate be extended, but it’s clear from the Treasurer’s comments today that the Gillard Government is making resources policy on the run.
“How can resources investors take anything this Government says at face value when it is constantly rewriting the rules?”
Despite sovereign risk issues, Australia was recently voted the 7th best country in which to mine.
The survey, by ResourcesStocks magazine, saw Australia jump in the rankings from last year, rising from 26th place in 2010 to its current 7th ranking.