Australia Considers Revising Resource Tax

15 June 2010 (Last Updated June 15th, 2010 18:30)

The Australian Government, under pressure from the resource industry, said it is considering revising its super profit resource tax in an attempt to lessen the impact on companies. The government is attempting to negotiate a separate deal with the coal-seam gas industry and is reportedl

The Australian Government, under pressure from the resource industry, said it is considering revising its super profit resource tax in an attempt to lessen the impact on companies.

The government is attempting to negotiate a separate deal with the coal-seam gas industry and is reportedly amending the rules of the tax for different minerals, according to The Australian.

If revised, the tax is likely to include provisions for the equal taxing of coal-seam gas and offshore gas, while low-value quarrying could also be largely exempt. All other minerals will be in a separate tax rate category.

The proposed tax - to be implemented in 2012 - has forced major mining companies to shelve more than $20bn of new resource investment in Australia.

The 40% tax will replace a royalty system if brought in.

The government said monies raised from the tax will be put towards infrastructure in mining states.

The tax, however, has drawn wide-spread condemnation from industry, with some mining giants including Rio Tinto and Xstrata holding back projects in the country.