Sid Sidebottom (Braddon, Australian Labor Party) Share this | Hansard source

The member for Kennedy would remember that I am assisting him in the House by speaking now. I know he will listen to what I have to say. He regards me, I hope, as a considerate person. He will consider what I have got to say and take it on its merits. The 20 economists, who include former ACCC chief Professor Alan Fels, made it clear:

There is no reason to expect a net contraction in mining over the longer term as a result of replacing royalties with the proposed resource rent tax. This is because a tax on economic rent of non-renewable resources is a more efficient way of raising revenue than taxing mining production (royalties).

It makes sense. But it does not seem that those opposite are prepared to use sense in their arguments. Last week we also saw thoroughly debunked the myth that the RSPT would push up consumer prices. When asked about that particular part of the scare campaign, another of the 20 economists, Professor John Quiggan, said:

I think that’s about the least defensible. The reason that there are super profits to be taxed is because of high world prices for these minerals that are set on world markets. So there’s no reason at all to think that the tax is going to affect the world price of these minerals, and therefore that that’s going to feed in any way into Australian consumer prices.

This was the point made by Treasury Secretary Dr Ken Henry, whom those opposite want to vilify, at Senate estimates last week, when he said that a profits based tax would not impact on consumer prices, although cutting the company tax would have a beneficial impact for consumers. Of course this has not been recognised by the big mining companies, who will benefit from the lower company tax rate.

By the way, I would like to add that those opposite, in their non-tax plan, will penalise the mining companies because they will not support a decline or a reduction in the company tax rate. Indeed, Treasury figures based on modelling from independent firm KPMG Econtech show the impact of the government’s tax plan on prices as follows—

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