Govt faces pressure over MRRT

THERE are calls for the Minerals Resource Rent Tax to be amended after it raised just $A126 million in its first six months – well short of the $1 billion forecast.
Govt faces pressure over MRRT Govt faces pressure over MRRT Govt faces pressure over MRRT Govt faces pressure over MRRT Govt faces pressure over MRRT


Kristie Batten

Pressure is mounting on the government to make amendments to the tax and some of the criticism seems to be coming from within the Labor Party.

Former prime minister Kevin Rudd first floated the resources super profits tax before losing his job to Julia Gillard, who replaced it with the MRRT after consultation with BHP Billiton, Rio Tinto and Xstrata.

Rudd told Sky News today that Treasurer Wayne Swan devised the initial RSPT following the Henry Tax Review, and he was also responsible for the MRRT.

“I think in terms of any future changes to the tax, given the fact it has not collected any real revenue of any significance so far, that really is a matter for the prime minister and the treasurer to consider and I’ll leave it with them,” Rudd said.

When asked if Gillard gave too much away to the big miners in the formation of the MRRT, Rudd said history would be the judge.

“I believe the Australian people deserve, through an appropriate tax mix, an appropriate return on the resources which are ultimately theirs,” he said.

In response to a question over whether the government was afraid of an aggressive advertising campaign from miners, Rudd replied: “No government should ever take a backwards step in pursuit of the national interest.”

Liberal Senator Mathias Cormann hit out at the MRRT, describing it as a fiasco and blaming the credit on royalties for the shortfall.

While the treasurer is now trying to hide behind commodity price volatility to explain the failure of his tax to raise any meaningful revenue, it is in fact the higher cost of the various concessions he and Julia Gillard made to the biggest miners that are mostly to blame,” he said.

“And there is no way to fix this dogs breakfast of a tax through amendments. It should be scrapped.”

Minister for Trade and Competitiveness Dr Craig Emerson told Sky there were no plans to change the tax, but the government would continue talks with the states over royalties.

“There are no plans to change the design of the tax,” he said.

“But in the area of royalties, as you say, it is already publicly known that we’re in discussion with the states.”

Shadow treasurer Joe Hockey has promised to scrap the tax if the Coalition wins the September federal election.

Meanwhile, Cormann described it as an anti-Western Australia tax and called for WA Labor Leader Mark McGowan to state his position on it.