Having witnessed the grand debacle of the mineral resource rent tax, a tax increase mused as part of the Henry Review to reduce Australia’s corporate income tax rate and support superannuation, I assumed Australia would be better off with no tax on super profits. The difficulties of administrating such a narrow base and intricate deductions while yielding little revenue formed the basis of my conclusions. I also thought that the Australian Labor Party, having lost significant political capital over tax issues, would move on and focus on other things while the world forgets. Instead the Australian Government announced the introduction of a carbon tax in 2012. Details have not yet been announced but it seems the introduction of the tax will be budget neutral rather than revenue neutral (e.g. the extra revenues from the tax will not be compensated by lower income tax rates). In consideration of this upcoming cash grab, I wonder if stakeholders from the mining sector would rather revert to mineral resource rent tax version 1.0 than having any form of carbon tax. Click here for the sector’s initial thoughts.
Oh No She Didn’t! Australian PM Announces Carbon Tax.1 03 2011