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And for the Australians reading you can realize that Australia is toast if it doesn't get its act together and put in a real mining resource tax. You can't just

by joonix 13y ago

And for the Australians reading you can realize that Australia is toast if it doesn't get its act together and put in a real mining resource tax. You can't just rely on employment from mining. The country's resources need to enrich its people, not just foreign investors. Otherwise you're just being robbed right before your eyes. If Norway can do it why can't Australia?

tacticus 13y ago
And the worst part of that stupid discussion is we already have a higher petroleum resource rent tax applied the same way as the MRRT is meant to be.
- jacques_chester 13y ago
  True, but there are some differences. The PRRT only applies offshore, where the resources are owned by the Commonwealth, not states. So there's no need to dance around state royalties. The second difference is that Hawke and Keating didn't just drop it like a bombshell. They took their time to talk it through with the industry, over I think it was about 18 months of consultation and negotiation.
deleted 13y ago
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marvin 13y ago
That's what I was thinking as well. If Australia doesn't have proper taxation of "insanely profitable" mining companies (paraphrasing), worrying about unions seems like misdirected effort. Norway has a 78% tax on profits from the petroleum industry, and the oil companies are thriving quite well. You can't exactly outsource the mining industry. In fact, extremely heavy taxation will help with the "problem" of unions because with heavy taxation, the mining companies wouldn't have an incentive to penny-pinch on salaries. And with higher salaries, a greater amount of the mining wealth would be evenly distributed and enter the economy where a larger number of people can spend it. This is what happens in the North Sea. As a bonus, the unions will to a greater degree spend their efforts of safety measures instead of a game of tug-rope when it comes to salaries. The Norwegian model works. Of course, you can't just tack on a 70+% tax regimen in retrospect without confiscating enormous shareholder value. So I think Australia is more or less screwed on this front. The best you could do would be to progressively tax new minesites. But of course this screws up the incentives unless it was done from the start.

by joonix 13y ago

tacticus 13y ago

And the worst part of that stupid discussion is we already have a higher petroleum resource rent tax applied the same way as the MRRT is meant to be.

jacques_chester 13y ago
True, but there are some differences. The PRRT only applies offshore, where the resources are owned by the Commonwealth, not states. So there's no need to dance around state royalties. The second difference is that Hawke and Keating didn't just drop it like a bombshell. They took their time to talk it through with the industry, over I think it was about 18 months of consultation and negotiation.

deleted 13y ago

[deleted]

marvin 13y ago

That's what I was thinking as well. If Australia doesn't have proper taxation of "insanely profitable" mining companies (paraphrasing), worrying about unions seems like misdirected effort. Norway has a 78% tax on profits from the petroleum industry, and the oil companies are thriving quite well. You can't exactly outsource the mining industry. In fact, extremely heavy taxation will help with the "problem" of unions because with heavy taxation, the mining companies wouldn't have an incentive to penny-pinch on salaries. And with higher salaries, a greater amount of the mining wealth would be evenly distributed and enter the economy where a larger number of people can spend it. This is what happens in the North Sea. As a bonus, the unions will to a greater degree spend their efforts of safety measures instead of a game of tug-rope when it comes to salaries. The Norwegian model works. Of course, you can't just tack on a 70+% tax regimen in retrospect without confiscating enormous shareholder value. So I think Australia is more or less screwed on this front. The best you could do would be to progressively tax new minesites. But of course this screws up the incentives unless it was done from the start.