New tax arrangements restore confidence in Queensland resources sector

Queensland’s peak resources sector body says the scrapping of the Resource Super Profits Tax has immediately restored confidence in the state’s resources sector.

Chief Executive of the Queensland Resources Council Michael Roche says the proposed new Minerals Resources Rent Tax (MRRT) arrangements for coal and iron ore and the application of the existing Petroleum Resource Rent Tax to coal-seam gas projects have met with an immediate and positive response.

‘Xstrata Copper will resume its $589 million Ernest Henry underground mine and reinstate its $30 million north Queensland regional exploration program,’ Mr Roche said.

‘BG group has indicated the new arrangements will keep the company on track to recommend its Queensland Curtis Island LNG Project to its board for sanction later this year.

‘I’m sure QRC members generally—small, medium and large—and the regional communities that rely on them have heaved a collective sigh of relief this morning.

‘The tax proposals announced by Prime Minister Julia Gillard ensure that Australia’s resource taxation arrangements remain globally competitive, which is good news for miners, investors and the one in eight Queenslanders whose jobs rely on the resources sector.

‘It also goes some way to restoring Australia’s reputation in the eyes of global investors.

‘The package is also a win for all those many hundreds of businesses around Queensland that will continue to supply billions of dollars worth of goods and services to a healthy resources sector.’

The exclusion from the MRRT of coal and iron ore operations with profits below $50 million and the exclusion altogether of the metalliferous sector (copper, zinc, lead, nickel etc) is recognition that not all resources operations can be treated the same. These projects will remain within the existing state royalties regime.

‘It was also sensible to place all Australian onshore and offshore oil and gas projects under the existing Petroleum Resource Rent Tax (PRRT),’ Mr Roche said.

‘We welcome the appointment of Don Argus to co-chair a transition group, which will ensure that the technical design of the new tax meets the intent of the new arrangements.

‘The QRC will be vigilant in scrutinising the detailed implementation of these proposed arrangements.’

Further information: Jim Devine or Caroline Morrissey 07 3295 9560