Australia Forges Ahead With Mining Tax

by Mary Swire, Tax-News.com, Hong Kong

08 October 2010

With the Policy Transition Group (PTG) having started its consultations on the proposed minerals resource rent tax (MRRT), Australia’s Minister for Resources and Energy, Martin Ferguson, has said that there is now an understanding in the mining industry that the government is determined to proceed with the new tax as announced on July 2 this year.

During a recent interview, he commented that the release of the PTG’s discussion paper has brought out the key issues within the MRRT. “The discussion paper,” he said, “has focused the attention of industry and individual companies because it raises the key questions which always had to be attended to.” He mentioned that key elements in the discussions, so far, have been on taxing points and on the AUD50m (USD49m) profit threshold.

He added that, with regard to the possible exploration incentives mentioned in the PTG’s paper, some of the mining groups “feel that we should be creating further incentives to actually encourage exploration. In the end, the PTG will make appropriate recommendations to government.”

When asked if he felt that the October 28 deadline for submissions to the PTG was tight, he reiterated that the mining industry itself had urged him to “resolve this by Christmas." He added: "They want these matters resolved for the purposes of certainty so as to also enable the government to finalize the draft legislation to be released prior to the end of this financial year.”

He pointed out that there would then be a further round of consultation after the exposure draft of the legislation had been issued, and before the MRRT bill was presented to parliament. In that case, there would still be opportunities for the industry to engage with the government, prior to the legislation coming into effect, the government hopes, from July 1, 2012.

Recommended