"Super" Mining Tax

[Gozu]

So much for your theory of a trillion $ worth of resources in the ground Gozu.

Aside from freeze = negotiations that 'theory' came from a Liberal Party politician the same party now trying to run a scare campaign on this Super Profits Tax, funny that.

This puts South Australia in the box seat. Australia has approximately 23% of known world resources with a large portion of those located in South Australia.

BHP is planning and currently undertaking an environment impact statement on a massive expansion that will make the Olympic Dam ore body one of the most bountiful in human history.

It is estimated to have one trillion dollars worth of resources.

The revenue and job potential of this massive investment by BHP is hard to comprehend.

In the start up faze alone there will be 13,000 jobs created and when the mine gets up and running it will increase net exports from South Australia over the next 30 years by over $16 billion compared to business as usual.

http://www.liberal.org.au/Latest-News/B ... Punch.aspx

Aside from freeze? The freeze is here and now Gozu. It is affecting business right now. Do I need to remind you of this South Australian project again?

http://news.smh.com.au/breaking-news-business/oz-minerals-shelves-project-20100519-vf5q.html

This development was due to be given the go ahead last week, but there will now be at least several months' delay, if not more. All thanks to the ALP's SSRT (super-stupid resources tax). Oh well, there goes 1000 jobs...

Do you understand what words like freeze, suspend, delay etc mean? They mean negotiating. Oh yes all because of the RSPT, because you know for a whole range of reasons delays never happen in the mining industry do they? I'm not sure what interests you have in all this purch but you really need to calm down and stop buying into the mining industry CEO's scare campaign. They've got enough shills and spin doctors in the mainstream media as it is.

[Gozu]

One more point.

Does the RSPT have the potential to be the next "Work Choices" campaign, for this years Federal Election?

For years unions have bankrolled the ALP whilst employers make token donations to both major parties - an 'each way' bet if you like. If the mining companies are serious, they could bankroll a massive election campaign for Abbott and Co which could be just the tonic the Libs need.

No, because it's already a vote winner and that's despite the ordinary selling job from the Government and the hysterical campaign being waged by Big Mining, News Ltd and other vested interests.

Do you think the big mining companies won't be bankrolling the Libs election campaign? They're in bed together. Remember how scrapping WorkChoices was going to destroy the mining industry? You take these pigs seriously at your own peril.

[Gozu]

Here's some thoughts on the Super Profits Tax by one of the world's leading economists, Professor John Quiggin:

The shorter version: the Tax is a good idea, and the criticisms we have seen are what you would expect from rent-seekers seeking to protect their rents.

The central arguments in favor of the RRT proposal are intertwined, and I’ll try to put them together in coherent way

* The basic efficiency argument: Since mineral deposits yield super-normal profits to those who have the right to exploit them, a tax on those profits will not lead to less investment – the profit will still be enough to induce investment

* The economic equity argument. Compared to almost any other tax we could impose, the burden of the RRT falls least on low-income Australians and most on high-income investors, many of whom are foreigners

* The legal equity argument. In Australia, mineral resources are, and always have been, owned by the state, representing all Australians, and not by individuals. So we should seek to maximize the return on our own assets.

* The political economy argument. Ever since I can remember, and probably before that, mining companies have been threatening to pack their bags and go overseas. They’ve made these threats when they were upset about tax policy, about environmental restrictions, about Aboriginal land rights, about union wage demands and work practices and when they were in a bad mood for no particular reason. But, even though lots of Australian industries have disappeared, or contracted drastically for a range of reasons, the miners are still here. The reason is obvious. They can leave, but they can’t take the minerals with them. It’s precisely this immobility that underlies the case for RRT

In practice, no tax works exactly in the way the textbooks suggest. A tax designed to fall on super-profits is bound to fall, to some extent, on ordinary returns to such activities as exploration and the development of mineral resources. But this does not significantly weaken the case for the RRT, for a number of reasons.

* Timing. In the ideal case, it does not matter when a rent tax is introduced. But given that there will be some tax on ordinary profits, it makes sense to introduce the tax at a time when profits are buoyant. It’s hard to imagine a better time than now.

* Macroeconomic arguments. The standard analysis implicitly assumes stable full employment. But, in reality, the economy fluctuates, and periods of high profitability in mining tend to be associated with booms in the economy as a whole. Under these conditions, an RRT is strongly countercyclical, since it raises a lot of revenue in booms and much less in recessions. And to the extent that it does affect activity in the mining sector, the countercyclical effect is enhanced. If the RRT constrains mining activity in boom times, more minerals will be available when conditions are not so strong, and ther are less super profits to be taxed.

There is, finally, a purely political argument for the government to stick with the RRT as announced. Having caved in on a range of issues, and most notably on the ETS where the mining lobby was prominent among the opponents, the government has to show some spine here.

http://johnquiggin.com/index.php/archiv ... -rent-tax/

[Gozu]

Nicholas Gruen:

And won't the so-called super-profits tax on surging mining profits kill the goose that laid the golden egg, the industry that saved us from the downturn? Not if you understand economics.

The new arrangements need never stop a single mine going ahead. If a project is viable, 60 per cent of the same project is viable. With a global portfolio of projects, multinationals might put a few offshore projects ahead of ours - but they will be delayed not stopped. Against that, lower company tax will encourage more marginal mine projects to get the go ahead.

http://www.theage.com.au/business/has-t ... -w82u.html

David Richardson:

Using the national accounts basis for Australian industry as a whole, the average tax rate paid by Australian business in the nine years since the Howard government introduced the New Tax System was 24 per cent. (To ensure the estimate is based on the same figures as the mining industry, tax contributions here include company tax as well as other taxes less subsidies on products but exclude the GST.)

In comparison, the $80 billion tax contribution of the mining industry averages out at just 19 per cent. So, on the mining industry’s own figures the taxes raised on the mining industry represent a smaller share of profits than for Australian industry as a whole.

It gets worse though. Mining is different to other industries since miners are given privileged access to resources that belong to the community as a whole. Royalties are collected to reflect the community’s ownership of the minerals. So one would expect to find mining is more heavily taxed than other industries. To find the opposite is surprising and reinforces the need for a resource super profits tax. It’s pretty clear that, to date, mining simply has not been paying its fair share.

http://www.onlineopinion.com.au/view.as ... 469&page=0

[Gozu]

George Megalogenis:

The mining companies have been collecting more money in recent years not because they are necessarily more efficient, but because China has inflated the price for our coal and iron ore.

Either way, the story happens to be the same. Mining is taxed less than most other sectors when it comes to corporate tax.

http://blogs.theaustralian.news.com.au/ ... deception/

Ian Verrender:

We've been bombarded by a series of ludicrous claims from bellicose mining chiefs that have only served to debase what should be legitimate concerns from the mining industry.

Yesterday, Rio Tinto boss Tom Albanese - the man who almost blew up the company and wanted to hand control to the Chinese government - claimed Australia posed a greater sovereign risk than any other country in which Rio operates. That's a rather bold claim, particularly given Rio ''lost'' a sizeable share of the giant Simandou mine in Guinea, in West Africa, a few years back when the government decided to simply resume it.

Last Wednesday, Andrew Forrest - the nation's richest man, whose company has paid very little tax until now because it has been in development phase for most of its life - claimed the tax overhaul had placed 30,000 jobs in jeopardy as he would be unable to gain finance for two major mining developments.

Over the weekend, he downgraded the job losses to 20,000; still a lot of workers to be sure but a substantial change on the previous week's estimates. Both projects, it should be realised, have yet to be approved by Fortescue. One was due to be evaluated next year, the other years down the track.

Forrest undoubtedly is a man of boundless energy and gritty determination, matched only by his capacity for hyperbole. His optimistic projections for his company during its early phase consistently overshot reality. It is a fair bet his current comments are equally weighted to deliver a result in his, and his company's, best interests.

The entire episode, coming as it does immediately after the canning of the emissions trading scheme following an equally intense lobbying campaign by the mining industry, harks back to the mid-1970s when the federal government decided to slash import tariffs.

Again, a Labor government. Again, it was accused of being anti-business. But that move opened up our economy, improved competitiveness and productivity and created the impetus for capital and labour to shift into high-value export production such as mining rather than competing against imports under a cosy protectionist umbrella.

Three important points need to be taken into consideration. The first is that mining companies do not own the resources of this nation; they merely are given a lease to exploit them. The second is that mineral resources are, by their very nature, finite. They are non-renewable and as a nation we get just one chance to maximise our benefits from them. And the third is that in the past decade, the big miners' profits have risen astronomically.

Increasingly, the benefits of the resources owned by Australian citizens are accruing to the shareholders of mining companies, not to the nation as a whole. It is a simple fact and one that cannot be disputed.

The sole beacon in this tawdry episode is Professor Ross Garnaut, whose learned and measured response to both sides should be applauded. He is the architect of the resources rent tax on our offshore oil reserves, a system that works. And there has been no shortage of capital invested in the energy sector since its inception.

This is a debate too important to be hijacked by those who stand to benefit most from maintaining the status quo.

http://www.smh.com.au/business/both-sid ... -w83e.html

[purch]

George Megalogenis:

The mining companies have been collecting more money in recent years not because they are necessarily more efficient, but because China has inflated the price for our coal and iron ore.

Either way, the story happens to be the same. Mining is taxed less than most other sectors when it comes to corporate tax.

http://blogs.theaustralian.news.com.au/ ... deception/

Once again you only tell half of the story Gozu. Here is really what Megalogenis said:

Author: Ross Louthean
Posted: Tuesday , 25 May 2010
PERTH -

Writing in The Australian, Megalogenis said the mining sector was by far the nation's highest-taxed sector because it pays royalties to state governments. However, they may be some of the lowest-taxed for Federal company tax.

He said the effective company tax rate for miners is 27.81%, the lowest out of 19 industry sectors, but when royalties are taken into account the industry moves to 41.34% -- the highest for total tax.

From http://www.mineweb.co.za/mineweb/view/mineweb/en/page72068?oid=105333&sn=Detail&pid=102055

Regardless, it's nothing like the 13%-17% that the ALP would have you believe (based on a piece of work, which even one of the co-authors admits, shouldn't be used the way the govt is using it).

[purch]

Source: http://www.theaustralian.com.au/business/mining-energy/rspt-could-close-onesteels-whyalla/story-e6frg9df-1225871693135

RSPT could close OneSteel's Whyalla
Rebecca Le May From: AAP May 26, 2010 5:11PM

ONESTEEL's Whyalla steel works in South Australia faces closure if the federal government's proposed mining tax proceeds in its current form, a broker says.

Credit Suisse said the steel maker's flagship facility could be closed unless the resources super profits tax (RSPT) is changed to exempt it from a 40 per cent tax on the market price of magnetite iron ore.

Magnetite iron ore is currently sold to OneSteel at cost, but the market price is much higher amid strong demand for the bulk commodity.

Credit Suisse says the RSPT may make Whyalla unprofitable and cash consuming, assuming the federal government applies the tax on the market value of magnetite at the mine gate, not on profitability at the end of the manufacturing process.

"The RSPT makes what is already a sub-economic steel making business at Whyalla barely break even," the broker said in a report on today.



"The only reason that Whyalla steelworks exists is because of its port location and proximity to captive iron ore at cost, rather than at market.

"Whyalla would not be economic if it had to buy iron ore externally (or internally) at market price."

OneSteel sells iron ore pellets when it has enough of the material for its internal steel making requirements, and these sales currently dominate the company's group earnings.

Without the subsidy of iron ore sales, the Whyalla steelworks were high cost and globally uncompetitive, Credit Suisse said.

"OneSteel effectively subsidises its steel operations by bringing in the ore at cost when it could send it offshore and obviously make market rate for that product, as it does with a proportion of its iron ore," South Australia Chamber of Minerals and Energy chief executive Jason Kuchel told AAP.

Mr Kuchel said the Whyalla facility had been subject to a special indenture - a legislated concession - for many years in recognition of the fact Australian steel makers couldn't otherwise compete with far cheaper steel making costs in China.

He agreed with Credit Suisse that the steel works would likely shut down under the RSPT as it stands.

Credit Suisse said the RSPT was likely to shave eight per cent from OneSteel's long-term group earnings.

"Under this scenario, we do not believe that the Whyalla blast furnace is viable business," it said.

Credit Suisse also said OneSteel had not pursued an expansion of its magnetite concentrate and pellet production capacity amid an uncertain medium term outlook for iron ore prices, and was less unlikely to do so now.

"Until now, we have seen this opportunity (expansion) as a potential sleeper in the portfolio.

"The proposed tax changes effectively turn it from a sleeper to a coma."

Mr Kuchel said the town of Whyalla would "virtually not exist" if the steel works were to close, leaving some 3,000 people without work.

He said this would be "an unintended consequence of an ill thought out tax".

Mr Kuchel also said the removal of state concessions could impact other businesses including cement and lime producer Adelaide Brighton, which buys limestone at cost.

He pointed out that the architect of the RSPT, Treasury secretary Ken Henry, did not recommend to the federal government that extractive industries - quarries and the like - should fall under the new tax.

[Gozu]

"Resource Rent Tax Statement":

My own view is that the RSPT design would be more efficient, but the losers under this design (those who can confidently expect high profits) have been very vocal, while the potential gainers (smaller miners undertaking riskier projects) have not given the government any support. Add to that the fact that the PRRT design is long-established (making scare campaigns a little bit harder) and simpler and there is a strong political case for a compromise along these lines. The most important thing is that the government cannot and should not back down on the basic principle of a resource rent tax.

http://johnquiggin.com/index.php/archiv ... statement/

[Gozu]

"Resource Tax: 22 leading economists speak out":

Signatories include Fred Argy, former director of the Economic Planning Advisory Council, Allan Fels, Dean of the Australia and NZ School of Government and former head of the Australian Competition and Consumer Commission, Deborah Cobb-Clark, Director of the Melbourne Institute of Applied Economic and Social Research and fifteen professors of economics from leading Australian universities, including the the Australian National University, Melbourne University, the University of Queensland and the University of Western Australia.

http://petermartin.blogspot.com/2010/05 ... mists.html

[Gozu]

It's all over purch.

Signed

Fred Argy AO, former director of the Economic Planning Advisory Council (EPAC) Jeff Borland, Professor of Economics, University of Melbourne Deborah Cobb-Clark, Director of the Melbourne Institute of Applied Economic and Social Research and Ronald F Henderson Professor, University of Melbourne Timothy Coelli, Professor of Economics, University of Queensland
Richard Denniss, Executive Director, The Australia Institute
Allan Fels AO, Dean, Australia and NZ School of Government
John Freebairn, Ritchie Chair of Economics, University of Melbourne
Quentin Grafton, Professor of Economics, Crawford School of Economics, Australian

National University Nicholas Gruen, CEO Lateral Economics, Director of the Business Council of Australiaʼs New Directions economic reform project from 1997 to 2000. Ross Guest, Professor of Economics, Griffith University Clive Hamilton, Professor of Public Ethics at Centre for Applied Philosophy and Public Ethics and Vice-Chancellor's Chair, Charles Sturt University. Michael Keating AC, former head of the Australian Public Service and Department of Prime Minister and Cabinet John Langmore, Professorial Fellow in the Political Science Department at the University of Melbourne John Mangan, Professor of Economics, University of Queensland Flavio Menezes, Professor and Head of School of Economics, University of Queensland Christopher OʼDonnell, Professor and Deputy Head of School Economics, University of Queensland David Pannell, Federation Fellow in Agricultural and Resource Economics, University of Western Australia John Quiggin, Federation Fellow in Economics and Political Science, University of Queensland Prasada Rao, Australian Research Council Professorial Fellow, University of Queensland John Rolfe, Professor of Economics, Central Queensland University
Ben Smith, Associate Professor of Economics, Australian National University David Throsby, Professor of Economics, Macquarie University.

http://www.scribd.com/doc/31959942/Economists-Statement

[Squawk]

Government mining tax ad blitz to cost $38m
By Sabra Lane
http://www.abc.net.au/news/stories/2010/05/28/2912548.htm
The Federal Government is under pressure over its decision to use taxpayer's money to run advertising on its proposed mining super profits tax.

The Government plans to spend $38 million on an ad blitz after granting itself an exemption from its own advertising guidelines in a bid to counter the campaign being waged by mining companies against the changes.

Special Minister of State Joe Ludwig granted an exemption for the ads on Monday, saying the issue is urgent because the mining industry's campaign against the tax could impact on financial markets.

In a media release Senator Ludwig said he could grant exemptions to the rules in the case of a national emergency, extreme urgency or other compelling reason.

Under the Government's advertising guidelines, campaigns worth more than $250,000 have to be approved by a panel of three retired public servants.

The exemption was quietly announced today after the Senate estimates hearings about government advertising had finished.

Deputy Prime Minister Julia Gillard says people want a campaign.

"I believe the community is hungry for information and we will be providing that information," she said.

But Opposition Leader Tony Abbott says the decision is hypocrisy from a government that promised to crack down on advertising.

"The Government can't have it both ways," he said.

"They can't say their great big new tax on mining is having no effect on financial markets and then claim the effect on financial markets justifies spending even the existing elastic requirements to have an emergency advertising campaign.

"This is a desperate act from an ethically challenged and completely panicked government."

The Opposition says the ad campaign is also an admission the mining tax will have an adverse impact on the economy.

Family First Senator Steve Fielding says the ads are propaganda.

"The Rudd Government has got themselves in this mess - now they're asking the Australian taxpayers to get them out of it," he said.

But the Government says it is spending far less taxpayers' money on advertising than the Coalition under the leadership of John Howard, which spent $420 million on promoting the GST.


Rudd's backflip

Labor promised prior to the 2007 election that it would cut back drastically on government advertising and that it would introduce new checks and balances.

"I believe this is a sick cancer within our system. It's a cancer on democracy," then-opposition leader Kevin Rudd told The 7.30 Report in October 2007.

Mr Rudd said as prime minister he would put his job on the line to ensure the auditor-general had the power to scrutinise expensive ad campaigns, to check their veracity, and make sure they were not simply political ads.

He was asked in 2007 if he would resign if he had not delivered this system within his first term.

Mr Rudd replied: "In terms of establishing the office of the auditor-general with clear-cut guidelines to whom every television campaign is submitted for approval before that television campaign is implemented, you have my absolute, 100 per cent guarantee that that will occur.

"One hundred per cent guarantee and each one of you here can hold me accountable for that."

But two months ago the auditor-general was sidelined from the job.

Instead a vetting panel of three retired public servants, known as the Independent Communications Committee, was set up to check government ads.

The committee is answerable to the government, not the Parliament.


Quiet announcement

Three weeks ago, a day before the budget, Treasurer Wayne Swan wrote to Senator Ludwig, who has oversight of the advertising guidelines.

Mr Swan sought an exemption from the rules to allow the fast-tracking of the multi-million-dollar taxpayer-funded campaign, funded in the budget, to counter the mining industry's ads against the super profits tax.

The exemption was not announced in the usual away, via email or a media conference.

A single-page note was quietly slipped into the press gallery boxes at Parliament mid-morning Friday.
(Friday = no 7.30 Report, Lateline, Lateline Business; end of the sitting week; a weekend before talkback radio can raise the issue). Senator Ludwig was unavailable for an interview, as was Mr Swan.

But Mr Swan issued a statement saying: "There's a very strong need and clear desire in the community to know more about the changes to our tax system and it's important we fill that need."

Mr Rudd has also avoided answering questions about the backflip, leaving that to Ms Gillard.

"As the portfolio minister who still has a warehouse full of mouse pads from the more than $120 million spent on the WorkChoices advertising campaign, I think we can see the approach of this government to the provision of public information is very, very different," she said.

"I would remind Tony Abbott those mouse pads are still available for moving to the Liberal Party if he wants to pay for the truck."

The Government's mining tax ads have already prompted the Liberal Party to bring forward its own commercials.

[Gozu]

They all do the Friday release stuff squawk. It's all about trying to control the media cycle. Look at the Libs as soon as the economists statement about the mining tax came out they dropped it all quick smart and the next day rushed out their Howard-esque border protection policy (knowing very well Newspoll are doing their polling this weekend which is also why the Government came out with their plans to sue the Japanese over the 'scientific whaling').

Yes, Rudd has backflipped on this somewhat. They all promise the world in Opposition, Howard said the same before the Libs got into office and they spent hundreds of millions just on selling WorkChoices alone. At least the Rudd Government have cut it right back but I think it would've been better to use ALP money on this.

[Squawk]

The irony for me Gozu is that having sat through countless TV and radio interviews on the subject, and still not knowing ALL the details by any stretch - and being bamboozled by Treasury modelling and Mining company assertions,

How is the government going to EXPLAIN this in 30 second commercials for a total cost of $38m?

[Gozu]

Laurie Oakes in the Herald Sun:

THE most sensitive part of a voter's anatomy is supposed to be the hip pocket nerve. On that basis, the tax debate on which Tony Abbott says the election will turn should be a plus for the Rudd Government.

According to Treasury analysis, the Government's proposal - a 40 per cent tax on resource industry "super profits", combined with a cut in the company tax rate from 30 per cent to 28 per cent - would mean money in the kick of the average worker.

An extra $450 a year to be precise.

Abbott's alternative - no mining tax, no company tax cut, and a 1.7 per cent tax increase for large companies - would see the same worker around $100 a year worse off.

People like Barnaby Joyce might scoff, but the boffins at Treasury - and at the independent firm KPMG Econtech, which did the modelling - don't make stuff up, despite what resource company executives would have us believe.

There is another table kicking around - also based on Econtech modelling -showing the impact of the Government's tax plan on prices: food lower by 0.9 per cent, clothing and footwear by 1.3 per cent, housing by 1.1 per cent, transportation by 1.7 per cent, communication by 1.4 per cent.

Guidelines unveiled so proudly last year to prevent the kind of abuses that occurred during the Howard era were trashed so that a tax reform advertising campaign can be rushed to air.

The mining industry campaign is certainly over the top, and difficult to counter. When mining companies devalue their own shares by forecasting dire consequences from the tax, people tend to believe them.

http://www.heraldsun.com.au/opinion-old ... 5872714013

[Gozu]

Here is some good info about who wins and who loses from the Resources Super Profits Tax:

Who are the winners of this tax? They include:

. Mine workers and mining communities. The long-run level of activity should go up, and the pressure on their wages and employment relations should go down.

. The general business community. Non-mining activities are taxed less because mining profits are taxed more, meaning that in general, businesses win out

. The general public, simply because they can expect to benefit from reduced taxation and receive parts of the services bought by this tax.

. The economic system, because this kind of tax is very dependable (minerals can’t run away to foreign countries and hence the tax can’t be avoided), making the public finances sounder and more reliable.


Who are the expected losers of this tax? They include:

. Shareholders in mining activities in Australia. When they bought their mining shares, the shareholders expected to receive a certain flow of profits, and that profit stream is now taxed more, making shares in mining less valuable. These losers include domestic shareholders and foreign shareholders, such as major Chinese interests in Australian firms and foreign shareholders in mining companies operating in Australia. To a certain extent, the RPT means Australia is grabbing in the coffers of foreigners to the benefit of its own population.

. Shareholders in mining activities outside Australia. Many countries are facing the problem of how to tax economic activities without reducing the level of economic activity, and Rent taxes are recognised as being pretty close to the economic textbook ideal as to how to do it. Hence other countries will no doubt follow suit if Australia pulls it off. This makes international mining companies understandably nervous.

. Other holders of fixed assets within Australia. This tax of course establishes the principle that assets that cannot run away might witness an increase in the taxation of the income generated by those assets. There are quite a few other sources of rent that could in principle be treated similarly, making owners of fixed assets justifiably nervous. Land, in particular, would be a prime long-term target for tax increases.

In short, many of the expected losers of this tax are foreign or super-rich, whilst the expected beneficiaries include the vast majority of the Australian population and the business community.

If the tax indeed goes ahead as hypothesised above, the political question will be whether the few losers will manage to fool the many winners into believing that it is in the interest of the many (including workers in the mining industry!) to protect the few.

I consider Rudd exceptionally lucky with the current avalanche of misinformation and self-interested commentary coming from the rich mining companies. It is not often in economics that a proposed new tax is so obviously a fight between the interests of the few and the interests of the whole, making it easy for economists to be fairly united on where they stand. The more fuss is made about it, the more it can become a defining issue for current politicians and the more satisfaction they can take from the experience.

http://economics.com.au/?p=5644

[fish]

Heard on the ABC tonight that the mining companies are spending up to $100million on their anti-tax advertising campaign.

Wonder where that money is coming from?

[southee]

Heard on the ABC tonight that the mining companies are spending up to $100million on their anti-tax advertising campaign.

Wonder where that money is coming from?

More like I wonder where Labour are getting their money from.....

[Squawk]

Anyone see Kerry O'Brien run rings around Wayne Swan tonight before chewing him up and spitting him out? Classic.

[Psyber]

Heard on the ABC tonight that the mining companies are spending up to $100million on their anti-tax advertising campaign.
Wonder where that money is coming from?

Both sides plan to take it out of my self-managed superannuation fund - and everybody else's superannuation - ultimately.
The Mining company expenditure will reduce my dividends from my mining shares.
In the end if Kev gets his super tax through that will cut my dividends.
I may have to see if I can get a part pension from CentreLink if the bite is big enough.

However, the dividends in all superannuation funds with any investment in mining will be affected.
I guess I'll have to keep my Telstra shares as all you Telstra/BigPond/Foxtel customers may help make up for any mining shortfall...

Overall I think it is reasonable for companies profiting from utilising irreplaceable resources like minerals and oil to pay royalties as well as normal company tax on profits, but I am not sure about the wisdom of patterns of selective taxation both parties have raised. I am particularly concerned about company tax varying from one industry to another as this could be used to influence party contributions and even personal largesse to MPs to shape their decision making about which industries get which rates..
The system needs to be transparent and non-manipulable as there is always corruption where it is not so.

We would however all benefit from a limit on executive salaries, or higher tax on huge personal incomes outside the normal distribution and, say, 2 standard deviations therefrom as this reduces the profitability of the companies too.

[Q.]

Heard on the ABC tonight that the mining companies are spending up to $100million on their anti-tax advertising campaign.

Wonder where that money is coming from?

http://www.crikey.com.au/2010/06/02/kevin-rudd-and-the-politics-of-the-sh-t-sandwich/

"Confronted with systematic lying from the mining industry, which has deep pockets, and a concerted media campaign every bit as deceitful, no government worth its salt can afford to simply not respond. It can’t afford it politically, and can’t afford it as a credible advocate of economic reform."


The anti-tax ads are a disgrace, but the layman will know no better.