Proposed R&D tax legislation

Deloitte has released a report on the effects the proposed R&D tax legislation will have on the mining sector.

Deloitte has released a report examining the upcoming changes that will arise from the Australian Government’s proposed research and development (R&D) legislation.

The report entitled Proposed R&D Tax Changes Set To Hurt Miners explores how the new legislation, which will come into effect 1 July 2010, will award tax credits for R&D.

Stating that the mining industry is one of the largest claimants of the current R&D tax concessions, the report claims that tightening of the eligibility criteria will effectively exclude a number of areas in mining technology development.

Deloitte’s report gives the example of a current ore processing plant.

It says “this will ordinarily involve design and development, evaluation of existing processes and new technologies, pilot scale testing and production trialling.

“Under the existing legislation all of these activities and associated expenditures would be claimable.”

The report goes onto say that the new legislation would prohibit a substantial scope of the activity as well as the expenditure incurred.

As a follow on from this report, Deloitte has announced it will be holding briefings on the upcoming changes and how they will affect miners and those in mining technology.

The full report is available on the Australian Mining website.

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