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Australian Mining Tax Changes Rattle BHP and Rio Tinto

The two large Australian mining companies BHP Billiton and Rio Tinto are unhappy about the changes being written into the mining tax post-election. This was made evident to the Senate select committee that is investigating the proposed Minerals Resource Rent Tax (MRRT) in Melbourne.

The agreement made stated that “all state and territory royalties will be creditable against the resources tax liability”, however the Energy Minister threw this part of the agreement into debate after the August elections.

Mr Martin Ferguson said that any royalty rate increase not scheduled before May 2 this year would not be creditable. The government fears allowing new royalties to be refunded could effectively give states the ability to raise them in the knowledge the federal government will foot the bill.

The chief advisor on government relations for Rio Tinto Mark O’Neill said today that the company would have been reluctant to sign the Heads of Agreement unless it believed that the issue had been resolved.

The agreement had been signed by Ms Gillard, Treasurer Wayne Swan and Resources and Energy Minister Martin Ferguson in July before the elections. The three main mining companies which signed the deal with the government were BHP Billiton, Rio Tinto and the Swiss mining giant Xstrata.

Joel Scanlon

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Joel Scanlon

Joel emigrated to Australia in 1995 and worked for five years in the mining industry as an exploration geotechnician, using GIS mapping and CAD software. Upon moving to the North Coast of NSW, Australia Joel worked as a graphic designer for a leading consultancy firm. After that, he ran a successful business providing web services to businesses along the eastern seaboard of Australia. During this time, he developed and launched News-Medical.Net. Joel has been working with AZoNetwork since the company was founded in 2000.

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