• 18 Jun

  The Mining Tax and You

  18, Jun, 2010 (4:06 PM)

  The Federal Government’s planned Resource Super Profits Tax (RSPT) will tax resource projects on their profits and replace the current system of royalties that taxes production, but not profits.
  
  The government says it’s a fairer way of taxing our resource wealth and will provide revenue to fund broader company tax cuts and personal superannuation increases. But the new RSPT has attracted a wave of criticism from the Australian mining sector.
  
  It claims that under the changes - as the most heavily taxed mining sector in the world - the national economy will suffer, jobs will be lost and millions of Australians relying on shares to provide them with a comfortable retirement will be affected.
  

   

  So where does this leave you? Are you in favour of the new tax? Will it do more damage than good? Or are you still uncertain how it will affect you?

  
  *Disclaimer - any personal details shared here are public and can be found on internet searches.

Comments (61)

1. Brett Gray - 30, July, 2010 (19:24)

   I don't think the original tax proposal was flawed, but the implementation of it certainly was. There was no useful consultation with the key stakeholders in the industry and very little discussion of broader tax policy objectives coming based on the Henry Review. The Government so far has done very little with the Henry Review and it would be useful to know the tax policy objectives of both parties for the next three years.

2. Rob Spencer - 29, July, 2010 (19:35)

   The original plan put forward by Rudd, Gillard, Swan and Tanner was deeply flawed. Rudd and Tanner are gone, and now we have Gillard and Swan making a new deal. Is this a prelude to returning to the original concept AFTER the election?
   And what of the rumours that some miners will benefit and others disadvantaged? Also, how can you be honest with a plan affecting miners, when one of those miners was involvd in the drafting of the plan. Spmething smells.

3. Rob Spencer - 17, July, 2010 (20:30)

   I have no problems with mining taxes per se and mining companies should pay their dues. In the current debate however, I feel that politics got in the way of a fair tax and the end result is skewed for political purposes. It would be unfortunate if the major miners received some relief due to their power and standing at the expense of minor miners without the same political clout. All for political expediency.

4. Alan - 6, July, 2010 (15:20)

   Again, to all the Socialist no good do-gooders please read sense from the 2 writers before me. If you are still confused, do please consider your friend Robert Mugabe as your next electorol candidate and see what nationalisation of his country's industries achieved. Viva Rudd, Viva Gillard .... Viva super-profits by the other name...you know the new name, bugger what is it now?

5. Brett Gray - 5, July, 2010 (17:23)

   The term Resource Rent Tax has been used by governments and industry for many years when this issue has been discussed. It is less emotive and to me a more accurate description of the proposed tax.
   
   I don't have an issue with the proposed tax but I think the Government made a huge mistake in not releasing the Henry report for public discussion, including its own tax policy objectives and parameters, before cherry picking a few of the recommendations. That would at least have provided information to show us the likely direction of future tax policies as I expect the Henry report will be used by governments for many years to come.
   
   The bluff and bluster of the mining industry was not a surprise, given the way the tax proposal was managed. Both sides were really playing to the grandstands leading up to the negotiations that should have happened much earlier. There is a clear policy development process lesson here and I hope the Government and its advisers remember it.

6. Ralphe M de la Croix - 3, July, 2010 (11:05)

   Here we go again – Labor Spin par excellenance (July 2, 2010) -
   Julia Gillard is a skilful user of language, which makes her extremely dangerous as a politician, and frankly, extremely dangerous to individual liberty. This is not just a criticism of Gillard but of all lawyers and politicians, all of whom are admittedly low hanging fruit
   It seems like a fraud has been foisted upon the Australian public...that everyone is entitled to benefit from the risk-taking of others without taking any risk at all...because the resources "belong" to all Australians.
   The resources would remain stuck and stranded in the ground forever, generating no royalty, tax, employment, or capital gain, or benefit for anyone if it weren't for private enterprise.
   Seven percent above the long bond rate is about 12%. But 12% sounds much bigger than 5%. So the miners win by forcing up the rate at which the super tax kicks in. But referring to "7" instead of "12" sows just a little bit of semantic confusion about the net size of the concession the government has made, making it seem like less of a concession to the public.
   
   Note the change in name from Resource Super Profits Tax - a name calculated by the Rudd government to portray the miners as greedy profiteers - to the Mineral Resource Rent Tax - a name designed to disguise the inherently predatory and opportunistic nature of the tax by making it sound reasonable, sensible, and inevitable.
   

7. Heather - 3, July, 2010 (8:33)

   While the tax rate isn't what the former PM wanted, I'd be interested to see if the rate increases over time - who knows what rate it will be in 2011 budget?
   
   Let's face it, taxes tend to rise and this seems to be a pretty lucrative one for the government -just a matter of time before it goes up IMO.
   
   

8. John Hunter - 2, July, 2010 (18:06)

   Maybe if the government put a higher premium on the product before it is dug from the groun, then the mining companies wouldn't winge so much.

9. Wiso - 2, July, 2010 (17:36)

   The level of ignorance by many commentators here astounds me. Some people really don't understand investment and returns. who in their right mind would risk billions of dollars for a measly 5% maximum return on investment. You might as well leave your money in the bank and earn 6% interest on it !! Thereby not creating any jobs, or paying any tax or royalties, and the minerals just stay in the ground for ever. Thousands more people competing for the too-few jobs available elsewhere, not infrastructure and development outside the major cities, etc. etc. There wouldn't be much money to go around if that happened. How stupid to say other companies would mine it !! There are not enough wholly Australian owned companies to do so, and it is not likely that any would take the risk under the new laws, even if they existed. What we need is a Government with the intestinal fortitude to do something to encourage manufacturing companies to at least partly process our minerals here in Australia before they go overseas. Stop selling it all as raw minerals. That would give us an even bigger share of any profits from our minerals than any super profit tax will. And provide even more jobs !!

10. National Seniors Australia - 28, June, 2010 (11:14)

    Thank you for your comments.
    
    Please be aware that National Seniors does not filter comments posted on our blog. National Seniors is apolitical and has no reason to filter such comments.
    
    If your comments have not been displayed, please email news@nationalseniors.com.au to enable us to check for technical problems.

11. Don - 26, June, 2010 (16:57)

    Comments forwarded here must be filtered in favour of the Labor Government, as members I know, who have made relevant comments, have NOT had the comment printed, probably just as this one won't. I therefore advise other Seniors' members to not waste their time.

12. Donal O'Sullivan - 25, June, 2010 (5:43)

    Why should the miners believe they are entitled to negotiate with the government about this tax? Were the drinkers of alcopops entitled to negoltiate with the government about the rise in tax? Of course not! The miners should shut up and pay up. They can always try to go to other countries where there are huge sovereign risks. Like what ahappened in Papua New Guinea when the Bogainville copper mine closed down because of local unrest and rebellion.

13. Gary Tearle - 24, June, 2010 (17:36)

    The resources in the ground belong to all Australian and the mining companies need to pay more for the privilege of extracting them. They have two option either pay the tax or sell them to another company.
    When travelling around Austalia I and my wife are disgusted at the huge holes in the ground developed my the mining companies, surely can back fill these hole when they have finished extracting the mineral from them

14. Brad Stanfield - 23, June, 2010 (11:01)

    Who has bothered to read the Henry Report?
    Who appreciates the credentials of the members of that group?
    Who has bothered to understand the economic world that they have envisaged here and elsewhere in the future?
    This isn't about politics ultimately; it's about economic survival. Make a choice or finish up like say the UK, suspension of government benefits and a GST of 20% perhaps.
    In the end, we'll get the government we deserve and the taxes that go with that, whether we're self funded or not. We all have to live here and share all we have, like it or not.
    

15. Robert - 22, June, 2010 (21:01)

    The mining industry is running a huge scare campaign and it is so sad that so many people have bought their rubbish. I work in the coal industry and I have access to the financial dealings of a couple of large coal companies. It is disgusting the amount of pure profit that they are making. One example, Company bought a large machine costing $16million, moved $78million offshore during the process. The shareholders never get to see the real figures on company profits as the information is always buried inside creative accounting. If this tax was so destructive, why is Andrew Forrest buying up huge numbers of shares in his own company? The companies also demand that their workers have to do exorbitant hours to maintain their jobs in this so called "competitive world". It is just another way of putting our communities under the thumb. The whole thing comes down to one thing:- GREED! I do not necessarily like the Labor Govt. that we have but having a good understanding of the way that the minerals industry council works and the immoral profits that these companies are making, all I can say is "Good on you Kevin, hold your mettle and bash it up em"

16. Kay Kelly - 22, June, 2010 (16:31)

    I agree with Trish Sargent (21 June blog). I am a self-funded retiree who has never received any handout from the government - not even the $900 stimulus package that even dead and overseas people received. I survive entirely on my own and my husband's superannuation and investments, after a lifetime of hard work. Hence my very survival depends on the overall health of the Australian economy and the share market. Mining shares are in the mix of the investments we have. To impose a massive, retrospective tax on the only truly successful enterprises this country have seems crazy to me!
    
    I am not opposed to ensuring that mining companies pay a fair tax, one that is comparable with the tax impost in other competitive resource countries. This comparison should take into account the enormous cost in time and money from exploration to successful production, including the many investment failures that occur.
    
    I suggest the government goes back to the drawing board - consults with industry and considers the long-term implications for the Australian economy. Trying to sell the new tax by attacking executives such as Clive Palmer only convinces me that a proper economic justification is just not there.

17. Barbara - 22, June, 2010 (15:15)

    While the mining giants are making huge profits from ripping minerals etc. out of OUR country, most of the profits are going to shareholders overseas. Even many of the executives are foreigners, and I'll guarantee that we would not be allowed to plunder and take 'stuff' from their country without paying a steep tax. It is time we Australians had a fair share of the profits for use in this country. We are just too good at giving our heritage away to overseas interests. If they can afford to pay for the huge advertisements knocking the government's idea, then they must have too much spare pocket money!
    Barbara
    

18. Liz Scott - 22, June, 2010 (15:14)

    Do the miners really think that they are going to close shop in Australia? There will be other mining companies willing to invest. It sounds like the big ones are being big bullies writing to smaller miners and associated companies to back their campaign. They close shop very quickly when the commodity prices fall, they don't worry about their workers then. Look at the coal miners in Qld. It was only two years ago that the Government was madly looking for jobs for the mine workers. Stick to your guns Rudd and Swan. It is our mineral wealth too.

19. Derrick Nugara - 22, June, 2010 (12:55)

    I believe that this new tax on profit is justified.The ore will remain in our ground,if any mining company pulls out.Its just a scare campain that they are running.The mining companies will not pull out, for obvious reasons.Good on you Rudd.

20. JOHN M KELLY - 21, June, 2010 (18:27)

    I AGREE WITH THE GOVERNMENT'S PROPOSED TAX. THE MOST SCANDALOUS ASPECT OF THIS DEBATE IS THAT FOREIGN OWNED AND CONTROLLED MINING COMPANIES, WITH MANAGEMENT SALARIES IN THE MILLIONS OF DOLLARS, HAVE NO COMPUNCTION AT CRITICISING OUR ELECTED GOVERNMENT - THE ELECTED GOVERNMENT RUNS AUSTRALIA, NOT FOREIGN COMPANIES AND IF THAT GOVERNMENT DECEIDES TO IMPOSE A TAX, THAT IS WHAT THEY WILL HAVE TO PAY. THE FOREIGN MINERS MAY LEAVE AUSTRALIA, BUT THE COAL AND THE ORE AND THE MINERALS WILL STILL BE HERE !

21. R Fountain - 21, June, 2010 (13:59)

    Our PM has done a very poor job of selling this 40% increase in tax .To increase anyones tax by 40% is going to create annoyance and as an educated person Rudd should have been aware of this ,His claims of helping the general public are dubious because 1st he has to try and get the economy back into the black .What he has done is damaging Australias future because if any projects get sidelined because of this tax and projectys go overseas then our future profits from mining will slump badly
    He needs to rethink and do it now .

22. garry - 21, June, 2010 (13:20)

    the government is bringing a fairer tax system whiich is what the mining companies asked for .
    Now they are whining because it is a tax on super profits .Super profits tax only coming in at a high level after exp[enses of starting the mines have been allowed for .
    
    The miners are running a scare campaign to make the mine owners even richer.
    
    The resouirces belong to all australians and once gone you cannot recreate it.
    

23. Trish Sargent - 21, June, 2010 (11:11)

    As a self funded retiree I have NEVER received a benefit from the Government. Not a first home buyers grant, child care grant, NOTHING. I have had 18% interest rates, increases in company tax and increases in personal tax. Gee I still managed to bring up a family, work, and I managed to get together a superannuation fund, so to be free of the Government's hand out, and now the value of that is being eroded by the Government's overall desire to look after "working families" in their retirement. Come on. We have given and given and given and now when it is our turn to get a little bit back we are looking at less and less.
    Self funded retirees unite. Chuck this lot out. Just because it is no longer possible to be a "working family" we should not be marginalized and penalized.

24. Ann - 21, June, 2010 (8:37)

    The mining companies have launched their big scare campaign by holding off on mining projects around the country as well unleashing a PR bonanza saying jobs will be lost and super will be affected. This is a tax on profits and these people are billionaires. Are the public so blind to this? I'm with the government on this one

25. Alan Brunner - 21, June, 2010 (7:45)

    In applying the mining tax to existing operations,the Rudd government is taxing the assets of all owners of mining shares ie taking dollars and value from all super funds and personal holdings. While it sounds good to have a super tax on mining, he is diminishing the dividends those assets will pay to owners in future. He may say he is taxing the companies but he is actually taxing us (owners of shares.
    All super trustees should be protesting against the Government.
    He seems hellbent on pushing as many seniors as possible from being independent onto the pension.
    The way he and his government is managing Australia and wasting our money is an absolute disgrace.
    

26. Robert Chruszcz - 20, June, 2010 (20:05)

    My greatest concern if China decides to takeover one of "Our Loyal Australian Mining Companies", and decided to pay nil dividends or pittence for the minerals mined. Where would be then?
    After all our minerals are exported we can then become a huge dumping ground to fill in the holes created by our Corporate Mining Companies.
    Thats right they will then ask the Goverment of the day for support {Tax incentives and other perks)using the scare tactics of need to creat jobs, look after shareholders , blah, blah, blah.
    Its about time we all including the Government stood up to these companies and protected our ability resource the world be it minerals or food.

27. Mike R. - 20, June, 2010 (19:30)

    It is blatently obvious that during the last 13 years the mining boom has become Australias economic saviour. We do charge royalties for our resources,the Miners do provide an enormous amount of of employment both directly and indirectly which has allowed Governments of both persuasions to invest heavily in infrastructure in recent years and thus employ still more people. The tax is a tax grab which would only have a bad effect on our economy. The Government continues to demonstrate its utter lack of financial management.

28. David - 20, June, 2010 (18:01)

    I am in favour of the tax and agree with the government. Australians should be able to share in the CORRECT TAX from profits,in the mining area. Naturally, the mining industry do not like any of these changes. Royalities and taxes on this sector have remained pegged for years and "Why should I pay all my Tax and big industry pays only the bare minumin".

29. Zenon - 20, June, 2010 (17:59)

    If the mining companies paid a proportional tax to earning as we workers do then they really would have something to whine about, I never heard the mining companies complaining or defending Australians when GST was imposed or when the price of bread and milk goes up. Stick it to em Mr Rudd it's their turn

30. Keith Smith - 20, June, 2010 (16:59)

    Kevin Rudd is being truthful when he says it could take months to get the mining super tax right. That is because he has no idea how to get hiself out of this big hole he dug for himself. Forget about Julia taking over before the election, why would she take over such a mess at such a time. She will bide her time and watch Kevin self destruct.

31. Louis - 20, June, 2010 (16:48)

    In the current debate on the Resources Super Profits Tax (RSPT), the government is squandering $38 million in taxpayers funds in an advertising campaign that is not only inept but downright misleading.
    True, the miners are putting out equally misleading advertisements, but at least they are not wasting taxpayers' funds doing so.
    Included in the RSPT is the proposal that miners will get a 30% rebate on exploration costs and a 40% rebate on losses incurred - paid for by taxpayers. This preposterous proposal has not been shown in the advertisements put out by both sides!
    The Federal government would be better off addressing the issue of reducing waste and inefficiencies in the public sector than interfering in the private sector.

32. Bill Flamank - 20, June, 2010 (15:07)

    What percentage of the big mining companies are wholly Australian owned? It seems to me these "company fat cats" are trying to scare the workers in this industry by threatening not to invest or create jobs. What a joke, I hope they pull up stakes and go home and leave the minerals here in Australia, to benefit this country not some overseas company!
    It's great that this government has stood up and decided on a tax that will help get our country back in the black rather than increasing the pressure of the wage earners who pay taxes on wages plus levies plus GST etc.
    Good on you Prime Minister, you will get my vote!

33. John Roberts - 20, June, 2010 (10:55)

    As with beauty the notion of what is fair seems to lie in the eye of the beholder - I have not seen any attempt by the Government to clearly explain what is fair in this matter apart from a range of claims - all disputed by not only the mining companies but a lot of financial and economic comentators also. The Govt has claimed that they are applying the principles of a Brown tax but appear to have cherry picked only the parts of Ken Henry's that they liked. When our leaders talk about an improved tax system and that things will be better they have the same credibility as tooth paste ads. Having read much of what others have said about this issue - see The Australian Newspaper 19 June in particular I find it is hard to see that this tax will succeed in making for a better Australia. From a state public service background this is again a Commonwealth mechanism to emasculate states ability to raise revenue and aims to increase the power of the Canberra mandarins. Also the notion that it is better for Govt to share in the profits and losses of industry is horribly flawed in terms of providing consistent and ongoing services - royalties provide a consistent revenue stream that is available to pay teachers and police what ever the fortunes of the industry - and it is a certain cost on the mine and predictable from day one as are wages and other costs. The share of profits for Govt is rightly gained back via the normal company tax payments. If super profits are such a problem why not also tax lottery and gambling wins. Of real concern to taxpayers should be the notion that Govt will be refunding 40% of costs associated with failing or failed mining ventures - that seems to be socialism gone bonkers in my view.

34. Harry Loudon - 20, June, 2010 (7:36)

    It's pretty obvious the Government needs to widen its tax base - after all, somebody has got to pay for all those increased government expenses and give-aways.
    
    Why isn't there any debate on the Government's expenses?
    
    When Government's increase taxes there always has to be a "fall guy" - the mining industry is just the current one. Maybe the banks and the superannuation industry will be next.
    
    I still cannot see why the States are not challenging this. If Rudd was "fair dinkum" he would be championing this tax for the States as a royalty replacement - (the States are the ones who own and control the minerals).
    
    Or is this really just another Federal take-over attempt.... dressed up as tax reform?
    
    
    

35. Marie Cameron - 19, June, 2010 (20:55)

    I agree with those who think the mining companies should give back more to the Australian people who own these minerals. They seem to think it is their God-given right to mine wherever they please, whatever the cost to others, and to tell Governments what they should and should not do. Rehabilitation of land is often a joke. Where I live, mining companies are threatening large expanses of fertile agricultural land, of which Australia has little enough as it is. An existing large open-cut coal mine has created an ugly moonscape, and the "rehabilitated" land looks as barren as a desert. Mining companies need to know that they are not above the needs and wishes of the Australian people, and must pay adequately for what they remove from the ground.

36. David Caddie - 19, June, 2010 (20:18)

    Why only a mining super profits tax? Why not a super profits tax on the prawn harvest, that resource belong to all Australians too, and what about a super profits tax on farmers when they have a good year?

37. Alf Jones - 19, June, 2010 (19:15)

    I don't believe the Government should impose such a high tax on the mining industry, as they do not take into account the years that companies spend in exploration, this is a very costly exercise, with absolutely no returns if nothing is found.
    If you had a mining company and you could mine in a country where it would cost much less to do the job, why wouldn't you go there?
    Anyway, the Bligh and previously Beattie Governments, made billions of dollars in Mining royalties over the last 10 years, where is that money now?, did you get anything out of it?. NO, it was just frittered away, same as this mining tax will be, if Rudd gets his paws on it. Good Luck to the Mining companies and miners, they all get paid well, they deserve it for the job they do.

38. Ray Lewis - 19, June, 2010 (17:17)

    The mining companies, just like big business everywhere, want to maximise their profits and minimise their taxation. The industry makes all sorts of excuses but the bottom line is always the industry's bottom line not the country's bottom line. Perhaps there should be a triple bottom line consideration applied to their projects. The first would be economic, the second would be environmental and the third would be social. Given those three, which should be the most important?
    
    When all we have left is the shaft or the pit where will the mining inductry be. Not helping us, of that I am certain. It will be pleading poverty, as usual!

39. David Hopkins - 19, June, 2010 (17:00)

    I am running our SMSF and am not concerned by the scare campaign being run by the mining companies. I hope the Govt doesn't give in the way they did with the ETS. I don't like the way that our ownership of Testra is being treated by the Govt.

40. Tom Jordan - 19, June, 2010 (16:17)

    Maybe its a lack of trust, from people generally, of broken promises and failure to deliver on anything. Some people might be forgiven for believing that, whatever the agreement now the Australian Government will probably change the rules after the election. My few Telstra Shares dont look as good as they could if there was certainty with the NBN - but there isnt and nor will there be with this tax. Does anyone really believe that the government will start paying out billions of dollars for their 40% tax guarantee if a project fails. There have been plenty of failures amounting to billions of dollars. Are Australian Taxpayers going to 'stump up' for these failures - and what if the mine was partly foreign owned? We (us taxpayers)would be paying our 40% overseas to cover their loss. How long does anyone really think that would last before Wayne Swan said that he couldn't balance his budget and then just decide to cancel that part of the tax. They have changed a few rules along the way, why would they stick to this if it wasnt working.
    
    
    

41. Lorraine harrison - 19, June, 2010 (15:29)

    My comment is how dare the top end of town in the mining industry (eg CEO, Peak Bodies, other wealthy players) so brazengly tell the Australian government who to tax. The Australian people elected this current government to run the country and collect taxes not the Mining Industry top end. The Mining Industry leading players take my breath away with their claims of unfair tax proposal. The current government is running the country not the mining industry.

42. Gordon Woolf - 19, June, 2010 (15:25)

    I'm encouraged to see that it seems a majority of small investors are not taken in by the loud shouting from the mining companies. Of course they should pay a higher proportion of their profits in combined tax and royalty payments. Sadly it seems however that while not convincing the majority of the thinking population, they may have persuaded the government, wrongly, that they have the majority on their side.
    It was amusing to see the millionaires out with placards.

43. Lance Cowan - 19, June, 2010 (14:08)

    The Labor Govt has made bad decisions about the handling of the "Global Financial Crisis" and spent its way into massive debt. It tried to get revenue via the Carbon Reduction Scheme, that failed. It tried to get the States to give back huge chunks of GST revenue to centralise Health management, that failed. It has clobbered smokers once again ( I am a non smoker) and now it is attacking the Mining Industry and Destabilsing the one industry that is taking our economy forward. In so doing they are deflating share prices and devaluing our Superannuation holdings. This is a Government who don't understand how the free enterprise system works. The 10 years hard work that Howard and Costello put in to pay out the Hawke Keating debt and give us a strong economy is GONE in one term of Labor.

44. Peter Stanley - 19, June, 2010 (14:00)

    The miners themselves have admitted they could pay more tax . The question is the way it is done. The current proposal is flawed and a modified tax would benefit the community who after all all own this non renewable resource.
    The uplift factor should be raised from the present 6% to the same as the oil industry at 11%,the top rate of 40% should be reduced to the current company rate of 30% ,the negative write offs which expose the taxpayer to unnecessary subsidies should be dropped and the tax should be modified for different types of minerals as some are no where near as profitable as iron and coal.

45. Paul Woolard - 19, June, 2010 (13:57)

    This is NOT a tax issue. The mining coy spay royalties of so much a tonne for minerals extracted. The rate was fixed years ago and does not increase with value of those minerals. For every other business the cost of raw materials fluctuates with the value of the commodity. That will be the effect of this new "tax". As the value of a mineral increases or decreases the cost of the raw material paid to "us" will increase or decrease. Couldn't be fairer than that. Imagine the "super profits" of any business if the cost of raw materials had been fixed 10, 20 years ago.
    
    The mining coys are quick to demand that sale contracts be renegotiated when existing contracts under-value their products due to market fluctuations BUT when the government on behalf of the people say that they want to renegotiate the royalties/tax/sale price of "our" products (the minerals in the ground) they cry foul.

46. John Messing - 19, June, 2010 (12:06)

    The fact that the debates are so emotional highlights what everyone knows about taxation: that the process ALWAYS involves are degree of skepticism regarding motives and suspicion that one or both sides are hiding something!
    
    The question that needs to be answered and cannot be, until BOTH sides put actual data into the public arena is whether or not the mining companies are paying a FAIR amount of tax compared to others who pay tax. Of course, the definition of FAIR needs to include as other have quite rightly pointed out some quantification of the risks, the value to the communities and Australia in general as well as the fact that this is a limited resource which is being expended by the mining companies for their corporate and personal gain.
    
    To date I have not seen a willingness on the part of mining companies to be up front about their financial models so I'm inclined to be skeptical about the so called altruisic mothives that they use to justify their positions. My view is that they are motivated largely by profit (and that's not wrong or evil but it can be greedy) and the altruism is only an incidental by-product.
    Similarly, the governments motives are also not lily-white. It has an agenda to find money to repay the massive debt that it has racked up. The PAYE taxpayer isn't going to be able to make a big dent in this, so going after the corporations that make huge profits is a politically palatable move. It just so happens that with so much of our manufacturing having been decimated, the mining companies are the only ones left as targets.
    
    Give us some real data, not just rhetoric, so we can really make up our minds!

47. B Flashman - 19, June, 2010 (12:05)

    I agree with Government. Mining companies want resources, they wont go anywhere else. It is just scare tactics.

48. Gary Blight - 19, June, 2010 (9:32)

    I agree with Fed Labor's premise - mineral resources are nonrenewable and they're the property of the people of Australia, not the miners. So we, the people of Australia, set the charge for exploiting those resources. And in the same way that the miners exploit the China bubble and gouge out higher contracted prices for their iron ore and coal, then why shouldn't the people of Australia fine tune the settings to get a greater share of the bubble wealth. My only critcism of the proposed mining tax changes is that they won't force the miners from being just hole diggers to being value adders i.e. turning iron ore from the west and coal from the east into iron and steel.

49. Peter Lincoln - 19, June, 2010 (9:10)

    I remember way back when the WA government were going to bring in the royalities on gold and the miners said that it would close mines and there would be job losses. But 30 years into the future there is more gold and general mining exploration than ever. So can we believe the mining companies when they tell us the same thing now? I think not. By the way i have workrd in the mining industry all my life.

50. Bruce Lucas - 19, June, 2010 (7:06)

    Wouldn't you use some of your EXCESS profits to ensure your multi million dollar annual salary, and bonuses for increasing the profitability of your company every year. Then why shouldn't the mining magnates do it?
    In fact they might even decrease the dividends to prove they are scared of losing those increasing profits and their bonuses. Why not allow those companies making EXCESS profits to pay the directors and CEOs millions and let the government pay pensions to suppliment the insufficient superannuation of the plebeians out of the petty mining royalties.

51. Michael Scanlan - 19, June, 2010 (6:30)

    There is a lot of misleading information. Firstly mining companies pay royalties to the state which are meant to be a share in the value of the resource. They also pay company tax like any other company. They underwrite everyone elses risk in the supply chain, water, electricity, rail and ports (and these agencies are making much better returns than 6 per cent for lower risk activities).
    
    On the environment, modern mines have strict approvals and requirements for mine operation and rehabilitation. They also empoy environmental specialists who are very proud of the way rehabilitation is undertaken.
    
    The dilemma is that the mining industry is an easy target for a government that doesn't wish to make more difficult taxation or reform decisions.
    
    We are currently in a boom cycle, don't forget that coal prices particularly were supressed for around 20 years through the 80s and 90s. In many cases mining companies sold their investments at a loss. Yes now they are doing well, but investors need confidence to invest and uncertainty is creating higher risk to invest in Australia. Don't be fooled there are alternative places to mine and invest, e.g. mining companies are gearing up to share in Africa's rich natural resources!
    
    Wouldn't real reform involve addressing duplication between local, state and federal governments?

52. Peter Robinson - 19, June, 2010 (4:45)

    I am amazed at the level of antipathy shown by the majority of blogs so far. They show for the most part that most people have no idea of what is involved in exploring for, setting up, running and, eventually, cloosing down a mine.
    The hysterical (well, almost) comments about not paying enough tax are ludicrous. The mining industry pays all current legal liabilities and has said it is prepared to sit down and negotiate a revised taxation regime. People are ignoring that.
    Current legislation requires mine sites to be rehabilitated when the mine closes but many, particularly open cut sites, are involved in progressive rehabilitation. Many who are yelping about this issue have no idea of what is actually taking place at mine site level and the rehabilitation plans in place. They should find out the facts before condemning companies that are already providing enormous economic benefits to this country.

53. Kevin Griffith - 19, June, 2010 (0:18)

    I believe that the miners have got away with destroying our environment at little cost to themselves. I believe that Clive Palmer is an obscenity with his massive wealth and his simplistic accusations of Communism. I believe that the Government proposals are, if anything, too weak and that 50% would not be enough. I am a self funded retiree and happy to see my pension decrease if it means my descendants and my fellow citizens will benefit by better health and education.

54. Noel Jones - 18, June, 2010 (23:00)

    I support a tax on Mining Super Profits; however, I believe the average Australian has very little idea of the details of current proposal. The companies already pay Company Tax so maybe the cut in point for Super Profits Tax should be higher than proposed (say 8%-10%). The additional RSPT should be an incremental tax based upon the amount of Super Profit - commencing say at 30%, then 45% and for large profits 60%.

55. ron webb - 18, June, 2010 (22:51)

    Mining co,s hit a new low in my view using an add in SA newspapers showing a country senior gent devistated because of his concern about his super pension being greatly reduced because of the tax.The body overseeing body of aust. super funds has already stated that the effect would be minimal & probably less than one %.Mining Co,s. would be well aware of this & that makes we wary of other info they are using to fight the tax..We are all aware that mining has assisted us through the GFC but miners adds would make you think their contribution saved the country.ABS figures show their contribution to GDP is about 10% & there employment rate is quite low.

56. George Adkins - 18, June, 2010 (21:54)

    Mining companies pay royalties to the State Governments for the minertals they mine. The deposits belong to the States (and Territories) not to the Commonwealth.
    Before making a profit, a mining company has to find the deposit, peg leases, evaluate the deposit, raise the money to develop the deposit, develop the deposit (including transport, power supply, water supply, housing etc) attract a suitable work force then commence mining. Over a period of time the deposit is worked out and the site(s) have to be left in a suitable condition.
    The company has no profit for many years, then its profits peak and then cease.
    Many mining companies did not reach the profit stage.
    Broken Hill and many other cities/towns exist only because of mining, eg Mt Isa, Norseman etc.
    If the Commonwealth Government would be better to consider taxing mining as a primary industry and tax it on an averaging basis.
    
    

57. Derek Donoghue - 18, June, 2010 (20:57)

    The mining industry scare campaign is working but what is not realised is their threats are just that. Of course they won't shelve their projects they're makin too much money and afraid to pay their fair share

58. Bill Adams - 18, June, 2010 (19:53)

    The miners claim that they "got Australia through the Global Financial Crisis" when in fact they cut their staff dramatically. Likewise most of them have a very poor dividend payout compared to industrial companies. I would not want to be relying on them to fund my retirement income.
    
    And while not related to the mining tax, it's sad today that a worker was killed while working for BHP in Western Australia.
    
    

59. Tom Meakin - 18, June, 2010 (19:40)

    Coca-Cola has to pay for the water it uses, albeit not enough. The petroleum industry is taxed and the proceeds are used to improve our roads. Of course the miners should be taxed. What's in the ground is ours; not just theirs. If the government decides to increase our taxes, do we get the chance to negotiate with us. It's just blackmail. If a mining company decides not proceed with a project, they should give up the lease and offer it to someone else. Apparently mining companies have paid as much as 95% tax in order to mine in Vietnam. It's a public relations battle and the miners seem to have more resources (sic) with which to fight.

60. Rosemary Irrgang - 18, June, 2010 (18:25)

    Cant imagine why the Miners think they should get our non renewable minerals free, mineral sale prices have increased enormously in the last few years and so have their profits and executive salaries. The dividends we get certainly dont cover all their profits.
    Only projects with a positive NPV will be taxed and the industry itself previously asked for a resource tax to replace the less fair royalties. If BHP, RIO and Fortescue dont want to develop profitable projects other companies will be happy to take them over. We also have a massive shortage of skilled people to work on mining and oil projects so deferring a few would alleviate this problem. Guess who will pay to clean up their environmental disasters if companies quietly move back overseas or go bankrupt? I notice the Chinese are also planning a resource rent tax. I have BHP and RIO shares and work in the industry.

61. Tom Fletcher - 18, June, 2010 (17:23)

    I am in favour of the tax and agree with the government. Australians should be able to share in the mining boom. Naturally, the mining industry is not in favour of the changes. Royalities and taxes on this sector have remained pegged for years.
    The mining companies have been making massive profits and they just want to keep on reaping these profits whilst raping the country. Their present press campaign is just a big scare tactic. The companies are just scared that other countries will get the same idea as Australia and slap on similar taxes.
    Furthermore as resources become less plentiful [Remember, minerals are finite] they will become more expensive. It is the law of supply and demand. After all we live in a dog eat dog greedy society.

Post your comment

 

*Name

*Email

*Comment

*Security Check

Enter the text in the image above.