Because they just can’t last when the weather turns nasty. For mining, via the AFR:
Iron ore giants BHP Billiton and Rio Tinto are facing a fresh tax grab in Western Australia just months after seeing off the WA Nationals’ concerted push to slap the miners with a tax hike that would have cost them about $3 billion a year.
West Australian Premier Mark McGowan confirmed on Sunday the new Labor state government would ask BHP and Rio to “buy out” the 25¢ lease rental fee they pay on every tonne of iron ore produced to provide a potentially multibillion-dollar injection to government coffers.
At current production rates BHP and Rio would collectively owe WA about $150 million a year in lease rental fees, and while there was no clarity on the number of years’ fees WA wants paid up front, the bill would rise to $4.5 billion if the two miners paid 30 years’ worth of fees in a lump sum.
The highly conditional plan relies on approval from the state, the miners and the Commonwealth government, which Mr McGowan hopes would exclude any lump-sum payment from GST distribution calculations.
I did warn Labor and everyone else that they’d have nowhere else to turn when they resisted the entirely justifiable Grylls push. BHP margins have shrunk since then but they’re still operating on a 93% mark-up:
They’re still super-profits on a non-renewing publicly-owned resource. WA has every right to tax them far more heavily on the grounds of inter-generational equity so long as they preserve the money, which appears to be the plan.
But, make no mistake, this will not be the end of it, either. The WA Budget is a catastrophe, with much worse to come yet.
Turning to the banks and their super-profits (by definition given even post-levy they remain undercharged for public protection), Fake Premier Bligh has to do something to appear to be worth her $6bn price tag so why not throw away some more money? Also at the AFR:
As a parliamentary inquiry into life insurance continues to hear shocking misconduct revelations and NAB became embroiled in a new scandal at the weekend, the banks’ mouthpiece, the Australian Bankers’ Association, has been interviewing agencies as they consider a new campaign.
The Australian Financial Review can reveal that agencies including WPP and Red Head have asked to pitch for a possible public campaign related to the $6.2 billion banking tax.
The ABA said it has “no plans to run a mining tax style campaign” despite its disappointment at the tax.
“Major banks continue to be deeply concerned about the federal government’s new bank tax and will continue to bring these concerns to public attention,” a spokeswoman said.
“The ABA has been approached by a number of ad agencies since the Budget, but, given the numbers in the Senate, has no plans to run a mining tax style campaign.”
Yes it does. Got to at least try to protect this:
When banks and miners took over the Australian policy-making apparatus and gave us a world-leading dose of Double Dutch Disease they left Australian governments no other honeypots to dip into.
