West Australian premier Colin Barnett has vowed to support any mining companies that mount a High Court challenge to the mining tax.
"If there was a constitutional challenge from a mining company then the State Government would probably join that challenge," he said.
Barnett has accused the Federal Government of trying to hide loopholes in the tax following The West Australian’s report which uncovered constitutional problems surrounding the implementation of both the Resources Super Profit Tax (RSPT) and the Mineral Resources Rent Tax (MRRT).
He said that Federal Government is attempting to directly interfere in the sovereign rights of the state.
The West reported that treasurer Wayne Swan was warned in May this year that the proposed RSPT would have breached constitutional requirements that national taxes do not discriminate between states.
If a state had to increase royalty rates on select minerals, then the High Court would find this discriminatory and thus unconstitutional.
Simon Bennison, chief executive of the Association of Mining and Exploration Companies (AMEC), said that “it is time the Government came clean on the details of the RSPT and MRRT.”
Bennison went on to say that “AMEC has always been of the view that, in accordance with the Australian Constitution, mineral resources are owned by the respective States/Territory governments, and not the Federal Government.
”AMEC noted that has discussed the Government’s intention to cap the crediting of State/ Territory royalties on a number of occasions, and that is has raised legitimate concerns about the structure and implementation of this tax.