Labor MP wants mining tax burden eased
A member of Prime Minister Julia Gillard's government has called for changes to the minerals resource rent tax, after accusing it of placing too much of a burden on small miners.
Just hours after revenue projections from the tax were more than halved from $2 billion to $800 million, WA Labor senator Mark Bishop said the tax should be altered to lessen the impact on small miners whose profits are below the $75 million eligibility threshold.
Despite not paying the tax, such miners are still paying compliance costs under rules that force them to reveal information to the Tax Office in case they become profitable enough to qualify for the tax in the future.
In a report written after participating in a recent Senate inquiry into the tax, Senator Bishop said the tax should be changed so that small miners were excluded from having to file extensive, regular, onerous and unnecessary information to the Tax Office.
"It would appear that the elements of the MRRT designed to lessen the burden for smaller miners are not working as intended," he wrote. "There is some evidence that smaller miners currently under the $75 million threshold still experience noticeable compliance costs in anticipation of one day exceeding the threshold.
"This element of the MRRT should be remedied to exclude those small miners who are unlikely to ever be caught by the MRRT from the requirement to file extensive information to government on a regular basis.
"It is poor public policy to apply a layer of bureaucratic compliance when the relevant companies will never face a tax liability."
Beyond the impact on small miners, Senator Bishop said the tax was "operating as intended".
Senator Bishop was one of several Labor parliamentarians who supported former prime minister Kevin Rudd's bid to regain the leadership of the Labor party from Ms Gillard.
Last month Senator Bishop indicated he would step down from politics at the September election.
The Coalition-dominated inquiry produced a report which called for the tax to be "abolished at the earliest possible opportunity". Among other criticisms of the tax from the opposition, the inquiry found that the "failure of the MRRT was entirely predictable".
The tax raised $126 million for Treasury in the six months to December 31.