Rudd wanted to fix mining tax before spill: Forrest

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Fortescue Metals Group founder and chairman Andrew Forrest says Kevin Rudd was on the verge of changing the mining tax before he was rolled by Prime Minister Julia Gillard.

The Financial Review reports the night before Rudd lost Prime Ministership he’d agreed with Forrest to transform the resource super profits tax and the delivery of infrastructure in Australia.

According to The Financial Review mining companies could have avoided liability for the tax by writing off their capital expenditure on infrastructure.

The deal was devised over a desperate few days in June 2010 as Rudd faced rising opposition over the tax and Forrest feared for FMG’s future.

Forrest alleges Gillard challenged for leadership a day after Rudd had briefed senior ministers on the progress of the new tax.

According to the magnate once Gillard took power Forrest and Rudd’s plan was dead and the altered minerals resource rent tax, devised with the help of resources giants BHP Billiton and Rio Tinto, was enacted instead.

Forrest said FMG was "thunderstruck" when news of the leadership challenge broke.

"We didn’t realise then that that BHP and Rio had gone behind our backs to do another deal," he said.

"When we were negotiating our solution with Rudd, I was calling BHP and Rio but they didn’t call back. They were working on their own deal."

Treasurer Wayne Swan said he wouldn’t respond to Forrest’s allegations on the mining tax and accused the magnate of opposing a measure to boost superannuation and make tax breaks for small businesses.

Earlier this year Swan launched an all-out attack on the mining industry and accused Forrest, Gina Rinehart, and Clive Palmer of using wealth generated from the mining boom to distort political debate.

Image: EcoNews

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