Budget to Share Mining Wealth Via the MRRT

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This year’s budget was unsurprising – overall, the government will spread the wealth of the mining industry to middle income families, students and the unemployed via the Mineral Resources Rent Tax (MRRT).

However, in a glimmer of hope for mining companies, their diesel fuel rebate and tax breaks for research and development were retained.

Earnings from the MRRT is expected to provide the government with $3 billion in its first 12 months. This is projected to rise to $3.7 billion by 2015-16.

More than half of the earnings from the controversial tax will be invested into programs to help combat climate change and encourage biodiversity.

The budget has been welcomed by the public and academics, but some mining associations disagree.

The Mineral Council has said that the Budget, whilst intending to spread the benefits of the boom, is in a poor investment for the future.

Mitch Hooke, the CEO of the Minerals Council said the resources sector needed fiscal stability, and that a changing  taxation landscape is put off investors.
 

"The government needs to shift gears from focusing on the spreading of the benefits to in fact building national capacity, and addressing those impediments to improving productivity, to work in to a stable taxation system so that we can invest today for the tax receipts of tomorrow, for the benefit of future generations, not just repairing a short term budget fix,” said Mr Hooke to the ABC.

Reg Howard Smith, from WA's Chamber of Minerals and Energy, said miners should be happy that their diesel fuel rebate and tax breaks were kept.

"We were pleasantly surprised that there weren't further changes to business taxation," he said.

"The rumoured diesel tax changes were not part of that, but I think we've got to remember that this budget is premised on the introduction of the minerals resource rent tax, and of course the carbon tax kicks in this year."