Mining Industry has heaved a sigh of relief on the reformed tax structure on mineral resources, as told by RIO Tinto executive director Sam Walsh. He said that it is the best deal what the Government can strike currently.
In a meeting organized by the American Chamber of Commerce in Australia, Mr. Walsh told that the final tax rate had been reduced from 40% to an effective 22.5% rate in the minerals resource rent tax. He further added that even still the rate is higher than in other countries.
The junior miners were left out of the final negotiations between the government and mining giants Rio Tinto, BHP Billiton and Xstrata, as noted by Mr. Walsh. But there is a need to involve them in the negotiations to get their feedback. The juniors were taken into account with a higher tax threshold and the need for them to earn in excess of $50 million a year.
He termed the whole debate over the mining tax as ‘unfortunate’ as there was no meaningful consultation process followed. As per him, the mining industry has always been willing to pay the tax and thus support the new tax reform.
The tax rate has been decreased to make mining viable in Australia.