A STEEP tax on mineral projects in Australia will help prevent the country from squandering the riches that flow from resource booms, according to a proposal to be put forward by the Greens.The party’s leader, Bob Brown, will announce today a plan to scrap a multitude of federal and state mining royalties and replace them with a national 50 per cent tax on excess profits on all major mineral production in Australia, including petroleum, gas, coal, iron ore and other minerals. The revenue would be paid into a national resource fund.The plan could increase government revenue from resource projects by up to $10 billion a year, depending on international market fluctuations.But the mining industry quickly rejected the plan, labelling it an ”unabashed revenue grab” that could block the development of mining projects.The Greens’ proposal would be a higher-taxing version of a plan for a 40 per cent resource rent tax that is believed to be under consideration by the federal government after the Henry tax review supported it.Both plans levy the tax on excess profits. It is a concept already used in in the current offshore petroleum tax regime.”Australians should be getting more for our natural resources,” Senator Brown said.”A national resources fund would ensure a fairer share of the benefits of the resource boom is delivered to the community.”He said only about 7 per cent of the value of mineral production now found its way into state or federal tax revenue.”The nation’s non-renewable mineral wealth is being sold off at a cut price to mining companies.”A growing and ageing population means we need to plan now how we are going to generate revenue into the next 100 years, not just the next 10 years.”With the additional Commonwealth revenue we could pay off Australia’s budget deficit and fund green infrastructure, renewable energy technologies, health services and public education.”To prevent future governments from using the money for tax reductions in other areas, an accusation once levelled at the Howard government, the fund would be administered by the Future Fund and run according to public interest guidelines.The plan was dismissed by the Minerals Council, which said a 50 per cent resource rent tax was unprecedented internationally and would threaten the viability of current and future projects.”The mining industry is already making a significant contribution to the economy,” Ben Mitchell, the council’s spokesman, said. ”It will pay about $21 billion in taxes and royalties this year, so a 50 per cent resource rent tax represents an unabashed revenue grab. This proposal should not be given serious consideration.”The Greens plan is modelled on a similar fund in Norway that has operated since the 1970s and so far collected $450 billion from North Sea oil revenue.
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