Joel Fitzgibbon (Hunter, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Trade. Will the minister advise the House of the significance of the minerals resource rent tax for Australian exports? What are the benefits of applying a profit based mining tax and the consequences of repealing it?

Craig Emerson (Rankin, Australian Labor Party, Minister for Trade) Share this | Link to this | Hansard source

I thank the member for Hunter for his ongoing interest in the mining industry of Australia, particularly in his own region. Of course, we are experiencing a mining boom in this country unprecedented in 140 years—the highest terms of trade and the highest mineral prices—and it is firmly the conviction of the Labor government that the benefits of the mining boom should be fairly spread so that it is not only the mining industry and their direct employees who benefit but the wider community. That is the philosophy that underlies the idea of a profits based tax on the mining industry. Indeed, as trade minister I can report that last month Australia recorded its second largest trade surplus, and this was built on the back of a resurgence in mining exports as a result of the resumption of exports, particularly in Queensland, following the devastating weather conditions and floods earlier in the year.

So that is very good news, but I note that there have been suggestions to the contrary—that mining in this country is doomed. Of course, the opposition leader said that the mining tax is 'almost guaranteed to kill the mining boom stone dead'. This is the prophecy of the Leader of the Opposition. Of course, we know that, rather than the mining industry being killed stone dead, there is in fact a massive pipeline of investment of $430 billion. These are huge numbers—an unprecedented mining boom.

But, of course, the economics of a profits based tax are far better than royalties that are levied on either the volume or value of production, because those royalties can actually deter mineral development and the full export of the mineral wealth of this country. So the royalties themselves are a deterrent, but a profits based tax is not. Yet again we have from the Leader of the Opposition no concern whatsoever about states increasing those royalties that do have an adverse effect on the mining industry and our mineral development. The opposition leader said:

… if people feel that the mining industry is under-taxed, there’s nothing to stop the states increasing royalties …

So he thinks it is fine for the states to increase royalties. But the truth is that the same opposition leader does not believe that the mining industry is undertaxed; he believes that it is overtaxed—that the mining industry already pays more than its fair share of tax. Again we are seeing the opposition—the coalition—always going in to bat for the few at the expense of the many. What we are seeking to do is dedicate the revenue from the mining tax to providing increased superannuation for working Australians; 8.4 million working Australians would get the benefit of an increase in superannuation and, of course, 2.7 million small businesses would get the benefit of the immediate write-off of assets valued up to $6,500. So here we are, in the week when we are introducing the mining tax, with the Leader of the Opposition always siding with the few. The once great party that says it stands for small business is absolutely against small business because it does not want them to get a tax break. The party that says it is for the workers, and says it is for the steel industry, votes against the steel industry plan and then says that the working people of this country do not deserve an increase in superannuation. We have two frontbenchers saying, 'Absolutely, that is right, they do not deserve an increase in superannuation.' It will always be Labor that sides with the many against the few in this country. (Time expired)