Hear, hear...

Hear, hear...

Hear, hear...

Hear, hear...

Hear, hear...

hey all that stuff in the ground can only be taken out once, and then it's gone, I reckon that we ( Australian people ) should get what we can cos we won't have much of an income once we've finished mining.

Durks said...

They're hardly in the same bracket as other companies.

There is a competitive advantage to exploiting minerals in this country over others where similar resource deposits may be. Access to markets, investment capital, infrastructure and stable government.

Wrong on at least two points .

there is no such thing as a free lunch...infrastructure in australia for the large miners (those that rudd likes to vilify) from mines , rail to port is owned by them, Rio, fmg, bhp own most there own infrastructure and what they don't own is almost all private.

its not just the large miners that have supply there own infrastructure either , its all miners.. even the mino's have to stump up to get electricity infrastructure in place, or camp sites for miners, water for their facilities.



second point : investment capital, Rudd's going on how most of the companies are majority foreign owned.. many mining companies have high foreign ownership because its foreign investment that has flowed into Australia to pay for the infrastructure /mine start up. Australia does not have the capital investment ourselves for mine startups. most need either off take agreements or " bought in finance" of some kind.

third point regarding governments

stable government = yes , stable policy = no

markets do best with certainty and stability as most mining projects have long lead times.

ETS is one example, this tax is another example of policy shift. whats next ?the investors don't know. compared to African governments where for example china can use its cheque book diplomacy to gain favor for stable policy toward their long term investments.. we cant compete on that low moral ground and nor should we, but it is an example of stable policy in what could be seen as an unstable government.

I think the Government should be getting what they can. They're making profits from digging holes and taking a countries fixed natural wealth. It's non-renewable and not exactly benign compared to many industries (relatively high levels of pollution, environmental degradation, some in culturally distinctive locations). While companies are making SUPERprofits from very high resource prices the federal government has every right to get in there and get a bit of the golden goose - it should intuitively be in the form of higher resource rents but that only flows to the states.

i agree government should be getting more of the pie, but its in the way the pie gets sliced that maters to how it affects the industry over a long term.

iron ore for example is mostly controlled by three majors, vale in Brazil, Rio and bhp, the high price of iron ore is possible because there are not many players in the market. so these companies are price makers and Chinese steel mills are price takers. supply /demand

6 percent above a bond return is not a super profit for every mine company out there. the small caps or the larger miners , its a large cast net over the whole industry not just the most profitable with the most valuable commodity.. its not a supa tax, thats just b/s to make it sound "fair" to the public.

the energy tax scheme that was put in place was very different to the one being presented now.. it was 6 percent plus 7 percent and it had a few other dimensions to it.. typically this tax has been compared to the super profit tax but they are not one of the same so its just a simplification sales pitch to compare the two.

Who's going to pack up and leave when they're making money hand over fist!! It's actually similar in concept to a progressive taxation system which we all accept for payroll...those that can afford to pay more pay a higher rate. It does need to be flexible so if resource prices head south it turns around though.

lost me on that one.


had a laugh when i heard how the government will be in surplus , the figures are so rubbery (not accusing labor , they just are for forward estimates by Treasury) that the budget can be cut either way by a deficit or surplus. i think its a matter of when i see it ill believe it since going over 200 bill in debt i guess its only way to cut it in an election year.

don't get me started on the waste of that 200 billion dollar debt, from the insulation scheme to over priced infrastructure projects to cash handouts that going off asx listed retailer companies share prices last year (jb hi fi a standout) much went to the retailers that made a profit selling Chinese produced goods.

wonder what the interest rate on that 200 billion will be, something like the super tax tax receipt probably?

If you want to share in the "resource boom", then come and help dig it out of the ground.

People sit in the city, working for Maccas or the council or on the dole, whining that the "boom" hasnt come to them.
Others are doing the hard yards, investing their hardearned in shares or sacrificing their time to leave their beds for a few weeks at a time, to make a better financial life for themselves and their families.

Evlpanda-risk and reward. Why invest in risky mineral exploration when you can invest in a bank where profits are taxed far less, there is little risk, and they dont produce hardly any (if any at all) foreign income?

I'll wager that you do not pay anywhere near 40% income tax.

latedropeddy said...

Sorry Kev - one thing that really annoys me is how you answer a question with a question.

Abbott - sorry buddy but you won't get my vote either. Any man who wears dick togs shouldn't be PM.

Maybe he should wear boardies over a wettie, red and yellow boardies perhaps.

Democratic politics is sad is it not. Its just a continuous parade of good people reduced to either beaten pandering suck holes fraught with self loathing or good time pub brawlers devoid of morality.

I would love to see the tax revenue generated from mining go towards something useful but the way this present government has blown money like a junky winning tatts really worries me.

How about putting some money aside into a soverign wealth fund for when mining goes off the boil ?

eg norway

en.wikipedia.org/wiki/The_Government_Pension_Fund_of_Norway

Invest money into R&D and then commercialise ??

The spending was a response to the GFC. Its pretty much done with.
Is a sovereign wealth fund anything like a "future fund"?
In any case I agree.

Then there are those of us that don't work in the mining area. THAT is the real world.

To be fair Twiggy has done a fair bit for the wider community (yes there is a world beyond ripping sh!t out of the earth) but he goes further than showing up for the opening of an envelope and is the exception rather than the rule.

Every time KRUDD makes a decision it seems to affect my business.
I get poorer, I cut labour. I cut costs.

Please KRUDD - please move to a South American Country where your type of leadership is the norm.

pineapples

Carantoc said...

Alternatively Pugwash Mining sets up Pugwash Minerals, a Hong Kong based minerals trader.

Pugwash Mining contracts to sell all its ore too Pugwash Minerals at 6% more than it cost Pugwash Mining to mine them at.

Pugwash Minerals then sells its minerials on the world market, at 35% more than it cost them to buy it.

Pugwash share holders happy, they got 1 for 1 when Pugwash split, still get dividends the same, total value of shares the same.

Pugwash Mining happy, it pays on same company tax as other Australian businesses

Regulators happy, although Pugwash Minerals get cheap minerals, their investment of loans in the project at low interest rates and uncertaintity in global markets the Pugwash Mining deal to secure long term stable sales complies with their fairness policies.

Hong Kong happy, gets tax revenue from Aussie minerals being sold to Japan.

Banks happy, they continue to make super profits on screwing the small investor but the focus is diverted elsewhere

Australia happy ???

Oi Pugwash, when did you and I start mining and down stream processing,? must have slept in this morning and missed the whole set up.

Boobs

Diver said...

Given that a some of the largest resources projects in Australian could now be considered mature and ongoing, their infrastructure should be in place. Of course their are current capacity constraints, but that is more due to the extra-ordinary demands that are currently being put on them.

Olympic dam, xstratas henry mine/copper smelters are mature mining projects. both requiring massive capex to prolong the life of these mines.. they have the infrastructure but why would bhp want to spend 20 billion on Olympic dam when overseas options might have a safer and more profitable return... Olympic dam is the largest uranium deposit in the world, (it has copper and gold as well) in any case there are almost as big deposits in safer investment countries (likes of Namibia) where half the money put into Olympic dam expansion could be used to capex and purchase such a deposit.

It is not really an issue of who owns the infrastructure, but how it was put there in the first place. Simply put, with a lot of help via tax and royalty breaks, investment allowances and other concessions. Which remain and are ongoing.

are you saying morally these miners are compelled to pay 57 percent tax because of incentives? isn't that the same then with all industries, be that the car manufacturing industry or the textile industry which have had similar types of investment allowances and other concessions... the argument that resources are finite can be used along side the lifespan of cars, or clothes.

Why should those perks continue for the benefit of a very select few companies and shareholders?

as i already stated, many other industries have these perks and incentives.

The resource rent tax is very specific and seeks to ensure that all share in the wealth that is being created, which incidentally we all own and the big miners dig out of the ground for us.

actually , constitutionally its more the states ownership of the mineral assets which they have been receiving a share through royalties. the federal government has received there tax receipts from the tax companies pay , this will continue to be payed but at 28 percent as well as the 40 percent resource tax

For the critics to turn around and say that this is akin to a nationalization of the countries resources - WTF.

haven't heard anyone say that but it is taking the argument a little too far.

So far it would appear that the costs and negative impacts (externalities) have been "nationalized" and bourne by Australia, but a fair share of the profits and excessive benefits continue to remain private.

mining is very localized, ei cost toward the environment from the mine to the port, that is where the cost are being born by communities, in most cases those communities benefit far more from a mine than if otherwise , mines have a responsibility at the end of its life to rehabilitate its project.

i listened to Andrew Forrest talking on ABC radio, one point he made was countries like china are more interested in supply than a profit to run a mine...there is nothing to say they could buy projects in Australia and run at a break even or even a loss, when run at a loss the government will have to re-inburst them.

countries like china are more interested in supply than a profit to run a mine...

Damn pinko, commie bastards.

there is nothing to say they could buy projects in Australia and run at a break even or even a loss, when run at a loss the government will have to re-inburst them.

I don't quite follwo as to what they'd be reimbursed for?

In the end of course big business and governments are going to clash. Business exists to make a profit and governments exist to redistribute wealth.

frant said...

Seems to be a bit of ignorance of economics out there. Seems to br a bit of ignorance of politics out there. Seems to be a bit of ignorance of the taxation system out there. ... So I am going to put another slant on it. I have been f***ed over by Malcolm Fraser, I have been f***ed over by Gough Whitlam, I have been ****ed over by Bob Hawke, I have been f***ed over by Paul Keating, I have been f**ed over by John Howard, I have been f***ed over by Kevin Rudd. Now at least could they all move over and let Julia Gillard f*** me.

Your arse must be sore