Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Hansard source

The Deputy Leader of the Opposition may be against our tax. I am not sure that the shadow minister for infrastructure is necessarily of the view that the mining industry should not be paying more. Look at his statements from earlier today. The second point I would make in response to the member for North Sydney’s question is—and he knows this infinitely well—that the whole point of a profits based tax as opposed to a volume based tax is to encourage the expansion of the industry. That is why, if he bothered to search the record of an illustrious predecessor of his—that is, the former Treasurer of the Commonwealth, Peter Costello—and looked at his remarks on the architecture of the Petroleum Resource Rent Tax, he would see that the former Treasurer understands and grasps the core significance of ensuring that it assists industry to expand. Let me quote what Peter Costello had to say:

The idea of the PRRT, when it was introduced—I think it was actually introduced by the Labor Party … from memory—

He is right on that—

it was certainly introduced by the Labor Party—… that the petroleum extractors would be taxed on their profits, except to the degree that they used it for new production or other exploration. In fact, that is a good policy aim.

In other words, Mr Costello, the then Treasurer of the Commonwealth, was saying that a tax on profits is in fact a more rational approach and a more efficient approach to the taxation of the sector—that is, a tax on volume. That leads me to the third point: the modelling produced through Econtech contained in the Treasury’s report on the day that the tax policy was released was of a type which concluded that the overall activity in the mining sector would increase by 5.5 per cent over time as a consequence of the total tax package which is being introduced. No. 1: we have a clear tax policy. The opposition currently have three tax policies on the run at once. No. 2: we believe the mining industry should pay more. We do not know where those opposite stand on that particular question. No. 3: we believe that the best way of taxing the mining industry is on profits rather than volumes because it is the best way to generate future growth and expansion in what has been and what will be a great industry for Australia.

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