MEMBER 80 adds to his previous comment:
“Thank you for publishing the excerpt from my feedback from last week – see 2011 TAXVINE No 20 (27 May 2011). I think I must have confused you with my rant.
Why do we have to complicate things? The mining royalties levied by the WA Government are not inefficient taxes – in fact I would dispute that they are taxes at all. The royalties are levied on a per tonne mined basis and are payment for the material that is removed from the State in the same way as a landscaper or property developer or weekend gardener will pay a landholder or reseller for the sand or gravel that they purchase to use in their projects – it is a simple trading relationship where the vendor just happens to be the State Government who is selling material owned (as provided in the Constitution) by the people of that state – and that has nothing to do with the Federal Government or the other States. I would put mining royalties in the same category as State-owned utilities that sell water or electricity to private and business users – we don’t call our water or power bills a tax and I am sure the Federal Treasurer doesn’t want to take responsibility for increases in those costs. On the federal level we don’t think of postage paid to Australia Post or the price we pay for coins from the Australian Mint as taxes and I am sure that list can be lengthened.
No one has said that there should not be any adjustment under the COAG processes, that was always known. I have had many years’ experience in the mining and related industries and seen a lot more downturns than booms and if our politicians would look at history instead of ingratiating themselves to voters who rely on urban myth for their mining knowledge, they would forget special taxes on mining that expose them to the same boom and bust cycle and just bank the additional income tax when it is there to reap. If the politicians want equity, they should stop wasteful and inappropriate spending or increase the tax rate and reap the rewards of good or bad management as appropriate.”