Australia is expected to introduce a new uniform national resource tax that will act like a rent on land used for mining projects, replacing the existing royalty tax.
Already the tax, which Treasurer Ken Henry said could help raise funds for the government, has come under attack by the mining industry, which says it could seriously hinder productivity and investment.
The tax will be similar to the petroleum resource rent tax being charged on crude oil and natural gas mined in Commonwealth waters and unlike state-based royalties, will be charged only after exploration and development costs for the project are paid off and the project starts making a profit.
The proposed rent tax will involve a 40% levy each year on various minerals mined in the country including coal, zinc, copper, iron ore as well as oil and will be charged on a project-by-project basis.
If approved, the tax could be launched by May according to a report in Australia’s Sydney Morning Herald.
The Minerals Council of Australia said the tax could hurt the sector at a time when commodities markets are recuperating from the global economic downturn.