The Australian Prime Minister Mr. Kevin Rudd is used to defending his government’s proposed policies as was evident in the health reform case. It seems it will be no different in case of the mining industry with the Resources Super Profits Tax.
The RSPT set at 40% is being seen as a major hurdle by mining industry heads. The tax is set to eat into operational revenues, as per them, and would cause an adverse effect on industry growth in the next fiscal session. A slow down that other economic experts are also predicting.
Since the tax was announced on May 2, 2010, the hostility that the Prime Minister has faced from the mining industry has been elemental in his slide in popularity polls. However Mr. Rudd feels that long negotiations are before the industry will accept the new tax rate.
He is sure that the tax rate is right and that the media should not speculate about a compromise. Getting a fair return from the mining industry may just cost the Prime Minister more than his popularity with the mining bosses.