After years of political wrangling, the Minerals Resource Rent Tax or MRRT takes affect as the country's largest polluters will now pay A$23 for every tonne of greenhouse gas they produce.
The tax is a step by Prime Minister Julia Gillard to meet global greenhouse gas targets. Opposition leader Tony Abbott, who is currently riding high in the polls, has vowed to repeal the tax as soon as he takes office.
The government expects that large miners like Rio Tinto and Fortescue will be forking over A$13.4 billion in 2013-2014. Smaller miners with profits of less than $75 million per annum will not be liable for MRRT.
Swan says the mining industry has provided huge benefits to the Australia but also increased competition for labour and a higher Australian dollar.
"These reforms – which have been opposed tooth and nail by the Abbott Opposition – will spread the benefits of the mining boom to millions of Australian households and businesses who feel like it is somebody else's boom," said Deputy Prime Minister and Treasurer Wayne Swan in a news release.
Since the introduction of the tax, the government says the resource sector, Australia's golden goose, has not been adversely affected.
"Investment in the mining sector has grown very strongly since the announcement of the reforms on 2 May 2010, from $47 billion in 2010-11 to an estimated $86 billion in 2011-12, and is expected to reach $119 billion in 2012-13. This is 13 times the level of investment before the first phase of the mining boom," said Swan.
The MRRT will have many sweeteners for individuals and smaller businesses.
Low and middle income families will receive higher family payments as part of the Benefits of the Boom package announced in the 2012-13 Budget. Small businesses will receive up to $6,500 in asset write offs. There will also be boost to retirement savings for workers and more spending on infrastructure.
"For all the economic carnage, the carbon tax won’t help the environment with Australia’s domestic emissions expected to rise eight per cent by 2020," writes Abbott.
Image of Super Pit in Kalgoorlie