Mining taxes bring in nearly $23 billion, report says
The mining industry’s tax and royalties bill is expected to come in at $22.7 billion for financial 2014, the second-highest tax take on record, according to data the sector will use to pressure the Senate over the stalled repeal of the Minerals Resource Rent Tax.
Mineral Councils of Australia chief Brendan Pearson says the industry’s bill remained high, despite a drop of almost 50 per cent in commodity prices since the lofty heights of 2011-12.
“This does underline that we are paying an effective tax rate above 40 per cent, when you combine the tax rate and the royalties,” Mr Pearson says.
The council is attempting to get on the front foot ahead of a looming federal government tax review and constant royalties revisions by state governments.
New estimates by Deloitte Access Economics in a report to be released on Wednesday show that the minerals industry paid $22.7 billion in tax and royalties in financial 2014, and $19.1 billion in 2012-13. The report was commissioned by the MCA.
Despite weaker commodity prices, a huge increase in iron ore and coal production in the year just ended helped buoy volumes
The figures are short of the $24.5 billion paid in 2011-12, when commodity prices were at their peak and there was no MRRT or carbon tax.
Mr Pearson said the latest data shows the mining industry pays its “fair share” and reinforces their argument that the MRRT is unnecessary.
“It just shows you that the MRRT was never necessary, we need to get that off the books. We never needed this third-tier tax to deliver a dividend to the public purse,” he said.
The MRRT was just $170 million of last year’s bill and cost $310 million in financial 2013.
But Mr Pearson called on the Senate to move quickly to repeal the tax, saying the industry was hopeful it would be quashed within the next two months.
The Deloitte estimates also include the carbon tax, which was repealed in the Senate at the eleventh-hour last month.
“It’s a tough time for the sector,” Mr Pearson said.
“Volumes should be up again, we just hope they are bolstered by better prices.”
The mining industry pays almost 25 per cent of company tax in Australia, up on 8 per cent a decade ago.
The MCA said the numbers “comprehensively puncture the wall of sound from the Greens”.
“It is time to move on from the notion that there are easy gains from ever higher taxes on mining.”