Australia’s Federal Government has seen sunnier days as reports revealed Thursday it has not collected any revenue in the first three months of its much-debated Minerals Resource Rent Tax (MRRT).
None of the large mining company operating in the country — Rio Tinto (ASX:RIO), BHP Billiton (ASX:BHP) and Xstrata (LON:XTA)— are liable under the tax, which explains why the Ozzie government did not receive any revenue by Monday’s payment deadline, according to The Australian (subs. required).
But Treasurer Wayne Swan is defending the levy and claims the real reason for the its slow start is the well-known China-driven cooling in the sector.
Swan told AFP nobody can deny the current "real crash in commodity prices,” adding that only Canberra this week is scaling back estimated receipts for 2012/13 from $3.1 billion to $2 billion.
Since May, when the original budget forecasts were prepared, iron ore prices have fallen 35% and coal has not done any better, which has hit both mining and company tax takings, added Swan.
It was estimated then that BHP and Rio alone, the two largest miners listed in the Ozzie stock exchange, would provide between $1 billion and $1.5 billion in tax payments in 2012-13.
The country’s third-largest iron ore producer, Fortescue Metals Group (ASX:FMG) —which launched a constitutional challenge to the tax in June— has repeatedly said that it won’t see a net surge in taxes in the early years of the regime. What’s more, it has suggested big miners in particular should be able to offset their liability against cash investment in their operations.
Australian Resources Minister Martin Ferguson, in turn, thinks it is a matter of time for the tax to work as he declared Thursday the onset of an era of low commodities prices does not spell the end of the country's China-backed mining boom.
Meanwhile authorities Down Under seem to be pushing through a tax based on the hope that minerals prices and mining industry profits will continue to grow.