"Australia's government plans to reap billions of additional dollars in tax from the country's booming resource industry and use the extra revenue to cut corporate taxes to a more globally competitive level and offer more-generous tax concession for smaller companies. ... The move to capture a bigger share of mining-company profits triggered an outcry from the resource industry, which argues that the plan puts more than 100 billion Australian dollars (US$92.55 billion) in future investment in the mineral industry 'under a cloud'. ... Australia has the world's largest reserves of brown coal, lead, mineral sands, nickel, silver, uranium and zinc--as well as the second-largest global reserves of iron ore, highly sought after by developing countries such as China", Rachel Pannett at the WSJ, 3 May 2010, link:
"Feeling like it missed out the last time around, Australia wants its piece of the next commodities' bull market.The government is pitching a Resource Super Profits Tax on mining profits. This is part of an overhaul targeting the 'proceeds of the next mineral boom,' for the broader economy. For example, nonmining corporate taxes will fall", Mohammad Hadi and Alex Wilson at the WSJ, 4 May 2010, link: http://online.wsj.com/article/SB10001424052748704342604575221700829646686.html.
It doesn't matter which government. In one repect they are all the same: they change the rules after the fact to your detriment. You who made Roth IRA conversions, take note.
Australia missed out? Did it "invest" in the minerals industry with public funds to develop mines and oil wells within Australia?
4 comments:
Total bullshit headline - there's no nationalisation involved at all. It's just a few extra percent tax on large profits - to share in some of the outrageous profits mining companies have reaped recently with the likes of the doubling of the iron ore price.
In Australia the crown owns the dirt, and mining leases are only for extraction. If the miners don't like it i'm sure someone else will be more than happy to take over their leases and earn the free money ...
Anonymous:
Suppose the tax were 90%. Would that be a nationalization? How about 99%?
IA
Australia is surely sensitive to the global competitiveness of the miners at various tax levels.
This tax, like most, will be passed onto the end user... i.e. the Chinese...
Seems like a good idea to tax users in a foreign nation to fund your nations improvements and social programs.
Anonymous:
The tax will not be passed on. It is on "intramarginal" mines.
IA
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