Aus plans for new iron ore tax an own goal, miners warn

17  October 2016

Mining bosses have warned that a plan by West Australian Nationals leader Brendon Grylls to introduce a new iron ore tax targeting BHP and Rio Tinto in a bid to raise $3 billion a year would represent a “massive Australian own goal”.

Malcolm Turnbull also undercut the proposal last night by using a speech to the Minerals Council of Australia dinner at Parliament House in Canberra to argue for a tax system that “encourages growth, investment, entrepreneurship and job creation”.

“The strength of our laws and the stability of our systems already make Australia attractive to worldwide investors and we want to make sure that our tax system does not detract from those advantages,” the Prime Minister said.

The chief executive of Rio Tinto’s iron ore group, Chris Salisbury, used his address to argue that the Grylls proposal was discriminatory and would transform Australia into the highest-taxed iron ore jurisdiction in the world.

“It would hit both jobs, local suppliers and future investment,’’ Mr Salisbury said. “It would damage our largest export industry and give a free kick to our competitors in Brazil and elsewhere. It would be a massive Australian own goal at a time of global economic uncertainty, with ripple effects far beyond the Pilbara.”

Mr Turnbull seized the chance to talk up the benefits of his 10-year enterprise tax plan aimed at reducing the corporate rate to 25 per cent by 2026-27 for all companies, but argued that innovation and the uptake of new technologies would become the critical factor for the future success of the mining sector.

“I know innovating is not easy in an already inherently risky industry,” he said. “Yet the profound truth is that only innovation will propel the next leap forward in productivity and performance for Australia’s world-leading mining industry.

Source – BS