- Firms concede need to pay more
- But Treasurer still faces bitter fight
- Libs burnt by share revelations
AUSTRALIA'S big mining companies have privately conceded to the Federal Government that they need to pay more tax on highly profitable ventures, Treasurer Wayne Swan has claimed, further stoking the fire surrounding the proposed resources super profits tax.
Preparing for a fierce "scare campaign" aimed at the controversial plan, Mr Swan said yesterday public statements from some miners condemning the new tax were at complete odds with the sentiments expressed in private discussions with the Government.
He would not reveal which companies had made such admissions.
The proposed 40 per cent tax on super profits will replace a 20-year-old royalties-based taxation system that the Rudd Government believes has not kept pace with the dramatic surge in profits in the booming resources sector.
"The miners know, in their heart of hearts, that they are going to have to pay a bit more because the royalties regimen has not kept pace with the value of this resource, which is 100 per cent owned by the Australian people," Mr Swan told the ABC.
"What we are doing is removing an existing tax, effectively a royalty, and replacing it with a new one, which is a better tax, a more efficient tax, one that will grow the industry in the long run.
"But some very profitable ventures will pay more, and they do recognise privately that they do need to pay a lot more."
Mr Swan will this week consult with 80 mining-sector leaders to negotiate "generous transitional provisions" but has ruled out any alteration to the 40 per cent tax rate that the Government seeks to impose.
A surfeit of mining executives have openly condemned the super profits tax since it was announced on May 2 as part of the Government's response to the Henry Tax Review.
Rio Tinto boss Tom Albanese last week likened the tax to a nationalisation of the mining sector, lampooning the Government for its dangerous rhetoric of calling Australia's largest miners "outsiders" because of their solid base of foreign ownership.
Similar barbs have been launched by BHP Billiton chief Marius Kloppers and Australia's richest man Clive Palmer, who chided the Government for "looking to destroy the economy" with a tax akin to communism.
Although the Liberal Party has described the super profits tax as crippling, its position was seemingly undermined yesterday when it was revealed Opposition health spokesman Peter Dutton had bought shares in BHP Billiton since the tax was proposed.
"By their actions, they are admitting the resources super profits tax can be consistent with very high levels of mineral development in this country," Labor frontbencher Craig Emerson said.
Mr Swan's office has also pointed to a range of new ventures and projects that were given the green light last week.
