“AMEC has consistently stated over the past two-plus years that the mining tax was an ill-conceived, poorly designed, discriminatory and a refutably bad tax that should be rescinded and replaced with a long-term tax strategy that encourages investment and is internationally competitive,” AMEC chief executive officer Simon Bennison said.

“It is clear that profit-based taxes anchored to commodity prices are fraught with risks.

“The revenue shortfall dilemma that the federal government is currently facing is a feature of the profits-based tax that was negotiated with the large multinational miners, and caused by falling commodity prices and a higher Australian dollar.”

Bennison said a redesign was not the answer and that the tax should be removed.

“Remove the uncertainty that has been created for investors, bankers and boards, and bring some confidence back into the mining and exploration industry in order that it can contribute to growth, productivity and create more Australian jobs in the national interest,” he said.

“The industry is already paying billions of dollars in income tax, royalties, payroll tax, stamp duties, levies and a myriad of other fees to local, state/territory and federal governments.

“The MRRT is therefore a ‘double tax’. These are crucial points that seem to have been ignored in the MRRT debate.”

Bennison said the government should go back to the drawing board, this time in full consultation with the mining industry.

Federal Opposition Leader Tony Abbott told 2GB in Sydney yesterday that the government had put itself in a terrible position after signing an agreement with BHP Billiton, Rio Tinto and Xstrata in the design of the MRRT.

“They signed a solemn pledge with the big miners not to change the design of the tax,” he said.

“Now, if they change it in any way to get more revenue they’re either going to be ripping off the miners and breaking their solemn word, or they’re going to be ripping off the states and one way or another, if they rip off the states the people will pay.”