Growing tax concerns for coal miners

COAL companies are disappointed that future increases in state royalties will not be credited under the Minerals Resource Rent Tax proposal, adding more weight to effective tax concerns when considering the possibility of a carbon tax.
Growing tax concerns for coal miners Growing tax concerns for coal miners Growing tax concerns for coal miners Growing tax concerns for coal miners Growing tax concerns for coal miners

Martin Ferguson - Federal Resources & Energy Minister

Blair Price

The issue was off the agenda in the Don Argus-led Policy Transition Group meeting in Brisbane yesterday, according to the Australian Financial Review.

The Queensland Resources Council reportedly thought it was part of the issues up for discussion but federal Resources Minister Martin Ferguson ruled it out.

Existing state royalties will be credited under the MRRT, but future hikes in royalties from the New South Wales and Queensland governments can never be ruled out.

While the state governments are explicitly allowed to set their own royalties under the constitution, the federal government is trying to get in on the action under its taxation power.

Western Australian Premier Colin Barnett is already sceptical of the legality of the MRRT – which is intended to bleed $A10.5 billion of revenue in its first two years.

In June, QRC chief executive Michael Roche said the Queensland government was forecasting that minerals and energy companies in the state would pay Queensland taxpayers almost $13 billion free and clear of wages, salaries, infrastructure, community support programs and corporate taxes to the federal government.

Apart from the MRRT and royalty hikes, the federal government is expected to come up with a carbon tax proposal that is favoured by the Greens party and BHP Billiton chief executive Marius Kloppers.