I’ve not posted on the latest mining tax brouhaha in the past few days, largely because it seemed all sound and fury signifying nothing. As I have argued for the past two years, the monstrously conceived tax had almost no chance of being reformed given the Gillard government came to power on secret concessions to miners and such illegitimacy was never going to be willingly revisited by Canberra.
It looks like I was right with the double-dealing of the Prime Minister on display this morning, from the AFR:
The federal government is considering plugging the royalties hole in its mining tax but will leave any changes until close to, or after, the election to avoid triggering another damaging campaign by the mining industry.
A letter from Prime Minister Julia Gillard to independent MP Rob Oakeshott, who is demanding the tax be toughened, says the government shares his concerns “about the interaction of state royalties and the minerals resource rent tax’’.
In the letter, sent on Monday, Ms Gillard notes the GST Distribution Review panel reported last year that allowing mining companies to deduct all present and future royalties they paid state governments from their MRRT liabilities was “neither desirable nor sustainable’’.
“The government is considering the GST Distribution Review and will take into account the views of states and territories,’’ she said.
But, said some strategist:
“It would be preferable not to have another $22 million campaign waged against us,’’ the strategist said.
I’m not sure why said strategist is still in employ. This is truly a political schmozzle of epic proportions.
Somehow the government has turned a no-brainer tax, that benefits the vast majority of Australians at the expense of just three multi-national firms, into a lightening rod for its own illegitimacy.
If it back-flips on the miners, it looks like it can’t be trusted. If it stays the course its minority partners will howl betrayal. Whichever way it goes the Opposition can have a field day.
If ever there was a lesson in poor policy implementation this must be it. The carbon tax is exceptional by comparison.
Given that we are now taking some of the refugee traffic off your hands, and that” New Zealand has allowed unrestricted imports of credits, including many hot air credits from eastern Europe, meaning New Zealand has become a dumping ground for worthless credits from elsewhere …No other country with a carbon trading scheme behaves in this way.” I’m sure we John Key will be able to give Julia a hand on the MRRT, somehow….
http://nz.finance.yahoo.com/news/nz-emissions-trading-scheme-more-181455248.html
Those absolutely stupid Hot-air credits is what annoys me the most about the whole Carbon credit trading scheme.
There are several companies in both China and India Creating powerful greenhouse gases for the sole purpose of collecting Carbon credit certificates to responsibly dispose of the said chemicals.
Anyone that has spent any amount of time living in 3rd world countries understands corruption. Believe me getting some 3rd world government minister to sign off on a bogus tree planting effort takes less time to negotiate then writing this post.
Accepting International certificates is a fraud on the Australian people. Even the European certificates have been so gamed as to be morally worthless.
+10 hear, hear.
+∞
And our “PM” was able to remove a fairly elected, sitting PM, in order to screw this tax up so badly. Still baffles me to this day how that was allowed to happen without being punished at the last election.
An appalling opposition perhaps?
The “opposition” is hardly likely to draw attention to treason. Especially when they are habitually as guilty of it (if not moreso) as their “opposition”.
Tweedledee and Tweedledum.
Gotta love how they blame royalties for leakage. One might be mistaken for thinking that the constitution did not expressly reserve royalties to the States as a source of income.
So it is not as though deducting royalties results in any loss of revenue to the public purse – just a loss to the particular purse controlled by Mr Swan.
If the Feds think the States are not charging high enough royalties or could be using a more sophisticated method of charging them – ie depending on market prices etc – they should encourage them.
If that does not work threaten to fiddle with the GST distributions on the basis of deemed royalty income ie – the income the states would have earned had they deployed higher royalty rates.
A profits tax is a daft idea to try to force more revenue to the grand centralisers in Canberra.
It is a bad idea and no surprise they look like gooses trying to make it work.
If the Fed is serious about Dutch disease or hollowing out and making some legitimate federal quid they should tradeable auction export volume permits.
But we know that they are not – they are quite happy growing the golden as fast possible and then plucking it as much as possible.
I agree with much of that Phf. These Feds are not remotely interested in Dutch Disease (understanding of which is undergoing massive refinement, no longer viewed from the spectrum of the 70s).
They are interested in the cash.
I’ve said that from the start Pfh.
The feds hold the reins and the stock whip.
As she gets closer to the election – the independents who sold their soles won’t matter much so their voices are going to become weaker.
It’s a one way ticket to annihilation as I have said all along. Watch them all trying to abandon a sinking ship.
Please note, I am a political atheist and do not support any party which is owned by bankers.
Correction: souls
“the Gillard government came to power on secret concessions given exclusively to foreign-owned multinational miners..”
Fixed that for you.