PERTH (miningweekly.com) − The Australian Association of Mining & Exploration Companies (Amec) on Tuesday came out swinging against the findings of the Parliamentary Senate Economic Committee regarding the proposed mineral resources rent tax (MRRT).
House Economics Committee chairperson Julia Owens tabled the committee’s report on the MRRT and its related bills, which recommended that the tax be passed by Parliament.
Owens noted that during the inquiry, differing views were given on how the tax would affect emerging miners compared with established miners. She noted that emerging miners believed that they would be paying a large amount of the revenue under the MRRT, and that the large mines would pay very little, owing to the larger starting base that established miners have available as a deduction against the tax.
“The committee is confident that the MRRT will operate as intended,” Owens said.
“The bills implement important reforms to the Australian economy and ensure that all Australians will benefit from the mining boom,” she added.
However, Amec CEO Simon Bennison said on Tuesday that the House of Representative Economics Committee report on the MRRT was “obviously confused” and had failed to identify any unintended consequences of this legislation.
“In its presentation and written submission to the Economics Committee, Amec stated that the tax is unfair as small emerging miners will be paying a higher effective rate of taxation than large mature miners. This differential could be as much as 4%.
“The anticompetitive nature of the MRRT has been supported by expert independent modelling by the University of Western Australia. We have not said that emerging miners would be paying the bulk of the revenue but a MRRT rate that is disproportionate to the majors.”
Bennison noted that despite having an objective to “identify unintended consequences” the committee had also failed to understand the impact that the MRRT would have on Australia’s small emerging miners, and our international competitiveness.
“During the public hearing, Amec provided a graph showing a steady decline in capital raising for Australian mining projects since 2009, and another demonstrating a significant increase in capital raising for international projects. The massive flow of capital offshore for exploration and mining has been ignored by the committee.
“This top-up tax remains unfair and needs to be addressed in the legislation. It is not too late to do so,” said Bennison.
The committee’s endorsement of the MRRT comes shortly after Independents Andrew Wilkie, Tony Windsor and Rob Oakeshott announced that they would support the tax.
However, Wilkie pushed the federal government to agree to amendments to the tax, lifting the threshold from A$50-million to A$75-million, and the phasing in of the tax from A$75-million to A$125-million.
It was expected that the legislative package would be pushed through the lower house by the end of this year, despite vows by opposition party leader Tony Abbott that he would oppose the bill.