Almost 40% of the 4,000 geologists in Australia are being forced to leave the mining sector due to a lack of demand and because of an absence of a tax scheme for mining investment, according to the Association of Mining and Exploration Companies (AMEC).
AMEC said the Federal Government pledged to help the sector by introducing a tax scheme prior to being elected; however, no scheme has been introduced to date.
It has accused Australian Federal Resources Minister Martin Ferguson of side-stepping the issue, which later became a part of the Henry Tax Review on Australia’s future tax system.
The exploration sector has repeatedly requested the Federal Government launch a flow-through shares scheme, which involves an up-front tax deduction for investors to motivate them to invest in drilling and exploration.
Australian Institute of Geoscientists representative Andrew Waltho said a flow-through shares scheme has had a positive effect on Canada’s exploration sector and now Australia needs the same to keep up with rising demand.
“Such a scheme helps the industry smooth the boom-bust cycle out,” Waltho said.
“The flow-through shares scheme in Canada has been demonstrably effective.”
AMEC CEO Simon Bennison said the association, which is supporting the launch of the scheme, is still not sure if the review is going to help introduce a scheme at all.
“We’re extremely disappointed, to say the least, that this government made an election promise and so far we’ve seen absolutely nothing,” Bennison said.