David Bushby (Tasmania, Liberal Party) Share this | Hansard source

Kevin Rudd, Canadian mining man of the year: that is what they have been calling him in the Canadian press in the last couple of days. What have they actually been saying? As reported in the Financial Times yesterday:

Gordon Peeling, chief executive of the Mining Association of Canada, an industry lobby group, said the Australian tax “probably makes Kevin Rudd (Australia’s prime minister) the mining man of the year in Canada, because he’ll bring a lot of investment our way”.

The fact is that Canada is a real alternative to Australia when it comes to mining investment, because it has abundant deposits of the very minerals that Australia is famous for delivering: gold, copper, coal and uranium. It is a real competitor to us in terms of our mining outputs and the exports that have underpinned the stunning performance of the Australian economy over the last 10 or 12 years—even in the last two, under this government. The article goes on:

In contrast to Australia’s left-of-centre Labor government, the ruling Conservatives in Canada are in the process of lowering corporate taxes.

That is right: ‘lowering corporate taxes’. The article goes on:

The basic corporate rate is to fall to 15 per cent in 2012, down from 22 per cent in 2007, and is the lowest among major industrial countries.

Yet what are we doing in Australia? We are looking at increasing the taxes on our mining sector—the most productive sector of the Australian economy—whilst our major competitors, who have the very same minerals that we mine and rely upon, are looking to reduce their taxes and increase their competitive situation compared with us. British Columbia’s mining minister, Randy Hawes, is also impressed with the Australian Prime Minister, according to the article. He said:

We’re very appreciative (of the Australian tax) … They should carry on and get all the revenue they can get.

He went on to say, noting that Canada’s metallurgical coal exporters have higher transport costs than their Australian rivals, that the proposed super tax is:

… ‘a very good way to level the playing field.’ Many of the world’s mining companies had offices in Vancouver and ‘they are all completely aware of what’s happening in Australia and what we’re doing in BC.’

This most recent article is not the only comment internationally that suggests that our competitors for international investment in our mining projects are salivating at the idea of the Rudd Labor government’s great big new tax on mining—particularly in Australia. There have been plenty of comments already from Canada, and I will quote some of those as well. Canadian Conservative MP Brad Trost has no doubts that the RSPT will drive mining offshore. He wants to cash in on the adverse reaction by mining companies. He said:

Canada, as is Australia, a major mining player and I think we see an opportunity to have some money come north.

He also said:

Well money goes where the biggest profits are and when you raise taxes profits tend to go down. So I’m sending out the message—Canada wants Australian business.

The dollars are going to move. People are scared because their profits are going to go in taxes so they should come to Canada—a low taxed, mining friendly jurisdiction.

What else did he say? He said:

Canadian companies pay the same tax rates as all other companies—

He is talking about mining companies—

and corporations do. And by 2014 we’re aiming to have a combined average of 25 per cent tax rate.

In response to the question put to him that the Australian government’s argument is that big mining companies make huge profits at times and the Australian public has a right to benefit from those profits, he said:

I’m fine if the Australian government wants to make that argument. I just want the jobs coming to Saskatchewan. The question is always what more can you get.

He went on to say:

But you ask yourself this question: If you’re a mining executive where would you sooner put your investment?

           …         …         …

We won’t get all the business. We know that. Australia will still have some of the business. But if we can get a percentage, an extra percentage, a little bit more because of this blunder by the Australian Government, we’re willing to help ourselves.

Senator Ryan referred to comments by Vancouver based Teck Resources boss, Don Lindsay, who said that the tax could be beneficial to him because Teck did not produce from Australia. He said, ‘If Australia really does it, then logically there will be less investment there, particularly in coking coal. That would mean less coking coal, so prices would be higher.’ That is what Mr Lindsay told Canada’s Globe and Mail newspaper on 15 June:

We went through a version of that (a tax increase) in Alberta when a new resource royalty regime was put in and there was a big backlash. Billions of dollars of investments were cancelled.

That is a real-life example. (Time expired)