Tony Crook (O'Connor, National Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Is the government aware of the expert independent modelling of the resource rent tax undertaken by the Western Australian university which illustrates a difference of at least four per cent in the effective tax payable by a small emerging miner as compared to an established miner? Is this discrimination against smaller producers an intended consequence of the MRRT and does the government intend to take action to address this inequity in tax burden between established producers and new entrants into the iron ore and coal markets?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for O'Connor for what is a very important question because the MRRT only taxes highly profitable mines, irrespective of whether they are big or small. I am aware of the study by the University of Western Australia and I have had the Treasury have a look at that study. I am more than happy to have Treasury officials brief the member on their conclusions about what that study means, which do not accord with the conclusions which have been drawn by the member today. o the Treasury does not accept the conclusion that there is a discrimination against small miners in the system. In fact, we have explicitly set out to remove small miners from the system, and we have done that in a way that is acceptable to the great bulk of the industry. We have been through extensive consultation with the mining industry over this issue. The legislation will come to the parliament later this year. It is perhaps one of the most important pieces of legislation that this parliament will deal with in this term. It is important that all Australians receive a fair return for the resources they own—100 per cent returns which are coming from a mining boom—so that we can assist others elsewhere in the economy, in particular those in the patchwork economy, for example, because they are not in the fast lane of the mining boom.

So the revenue that will come from the MRRT, which is paid only by the highly profitable companies regardless of whether they are big or small, will be used to give tax cuts to all companies right across Australia. There could not be a better time for that to be happening—to give a tax cut to many of those companies that are not in the fast lane, most particularly to give a significant tax cut to those struggling small businesses out there. The instant asset write-off is a very important tax cut that is coming to small businesses—2.7 million of them—courtesy of the fact that we are in a position to ensure that Australians get a fair return for the resources they own 100 per cent. In addition to that, we can make important investments in infrastructure, particularly in those regions where mining is strong and where there are capacity constraints.

That is why I say this is a very important discussion. The legislation coming up in the House later this year is absolutely critical to our future economic development, to strengthening our economy and to supporting jobs, particularly in small business. I am more than happy to sit down with the member and more than happy to have the Treasury sit down with the member to take him through our conclusions about that modelling, which demonstrate that the MRRT delivers a fair return to the Australian people and that that money is going to go back into important investments, not just in mining communities but right around Australia, to help small businesses in the whole community.