NSW Independent, Rob Oakeshott, has demanded a Treasury briefing on the mining tax saying the government was ‘done over’.
Oakeshott has written a letter to Prime Minister Julia Gillard, demanding to know why large amounts of revenue are being lost ''directly due to changes negotiated by your government with key stakeholders in the mining sector''.
He said loopholes in the current legislation which allows miners to deduct all state royalties from their mining tax liability meant the tax miners pay was greatly minimised.
'I remain concerned that allowing state-based royalties to be deductions only provides incentives for state governments to tax harder. The [mining tax] as negotiated has done more to minimise mining taxation than to make mining taxation more efficient,'' SMH reported his letter says.
'I remain concerned at the rhetoric of 'spreading the benefits of the boom' from the mining industry to other sectors, when the actual benefits to those sectors appear to be far outweighed by the difficulties associated with a record exchange rate.
''Finally, I am concerned at [mining tax] receipts equating to just a third, at best, of what was originally proposed, and that this has significantly compromised the scope for pursuing other tax reform, education and disability measures.''
The letter from Oakeshott comes as the mining tax failed to produce any revenue in its first three months.
The government cut MRRT revenue predictions from $3.7 billion to $2 billion for the 2012-12 financial year.
As Australian Mining reported in September, the Greens plan to introduce a private member's bill to prevent the Commonwealth from reimbursing companies for state royalties.
Greens leader Christine Milne said the bill would prevent state governments from rorting the mining tax system.
"Until this loophole is closed, Campbell Newman, [WA Premier] Colin Barnett and Co can lift state mining royalties as high as they like in the full knowledge that it is the commonwealth government who will foot the bill," she said.