Footnotes

Chapter 1 - Introduction and overview of the Bill

[1]        Explanatory Memorandum, Minerals Resource Rent Tax Amendment (Protecting Revenue) Bill 2012, http://parlinfo.aph.gov.au/parlInfo/download/legislation/ems/s886_ems_21291f0b-bf61-4d0a-afa6-98c517cfd358/upload_pdf/12157em.pdf;fileType=application%2Fpdf.

[2]        Senator Milne, Senate Hansard, 12 September 2012, p. 6769.

[3]        Senator Milne, Senator Hansard, 12 September 2012, p. 6769. The quote is from Australia's Future Tax System, Report to the Treasurer, part 2: detailed analysis, vol. 1, December 2009, p. 240.

[4]        Senator Milne, Senate Hansard, 12 September 2012, p. 6769.

[5]        Australian Government, 2010-11 Budget – Budget Paper No. 2, p. 45.

[6]        Policy Transition Group, New Resource Taxation Arrangements (December 2010), p. 57, http://www.futuretax.gov.au/content/Publications/downloads/New_Resource_Taxation_Arrangements_Report.pdf; and the Hon Wayne Swan MP and the Hon Martin Ferguson AM MP, Government Accepts Resource Tax Recommendations, media release, 24 March 2011, http://minister.ret.gov.au/MediaCentre/MediaReleases/Pages/GovernmentAcceptsResourceTaxRecommendations.aspx.

[7]        Senator Milne, Senate Hansard, 12 September 2012, p. 6769.

[8]        Senate Economics Legislation Committee, Mineral Resource Rent Tax Bill 2011 [Provisions] and related bills, p. 33, https://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=economics_ctte/mrrt_bill_2011/report/report.pdf.

[9]        Senator Milne, Senate Hansard, 12 September 2012, p. 6770.

[10]      Senate Standing Committee for the Scrutiny of Bills, Alert Digest No. 11 of 2012, 19 September 2012, p. 17, https://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=scrutiny/bills/2012/b12.pdf.

Chapter 2 - Views on the Bill

[1]        Professor John Quiggin, Submission 1, p. 1.

[2]        AMEC, Submission 2, p.1.

[3]        MCA, Submission 5, pp. 2–3.

[4]        MCA, Submission 5, pp. 9–15.

[5]        AMEC, Submission 2, p. 2.

[6]        Queensland Government, Submission 3, p. 2.

[7]        New South Wales Government, Submission 6, p. 2.

[8]        AMEC, Submission 2, p. 2.

[9]        AMEC, Submission 2, p. 2.

[10]      MCA, Submission 5, pp. 16–17.

[11]      Queensland Government, Submission 3, p. 1.

[12]      AMEC, Submission 2, p. 2; and New South Wales Government, Submission 6, p. 2.

Dissenting report from the Australian Greens

[1]        For example, the Greens’ minority report in Senate Economics Legislation Committee, Minerals Resource Rent Tax Bill 2011 [Provisions] and related bills, March 2012, pp 117-146.

[2]        Australia’s Future Tax System, December 2009, Part 2, pp 217-240.

[3]        Memo from Commissioner of Taxation to Treasurer, 8 February 2013.

[4]        One problem with royalties is that, due to the understandable desire not to set royalties so high that they lead to projects being abandoned, they are typically set at a level that leaves even the highest cost projects profitable in years of low commodity prices. This inevitably means that the tax on the lower cost projects is a very small proportion of profits when commodity prices are high. A study commissioned for the Henry Tax Review suggested that royalties involved marginal welfare losses of around 70 per cent of the revenue raised, the highest of the 12 types of taxes examined whereas resource rent taxes involved no welfare loss; Australia’s Future Tax System, December 2009, Part 1, p 13.

[5]        Australia's Future Tax System, December 2009, p 240.

[6]        The Resources Super Profits Tax, 2010, p 31.

[7]        Dr Hen Henry, Secretary, Department of the Treasury, Senate Committee on Scrutiny of New Taxes Hansard, 22 November 2010, pp 9 and 12.

[8]        Minerals Council of Australia, Submission 5, p 3. The Association of Mining and Exploration Companies is a little more specific, arguing the problem ‘should be dealt with through other processes such as the Commonwealth Grants Commission’; Submission 2, p 2.

[9]        OECD, Economic Surveys: Australia, November 2010.

[10]      Senate Economics Legislation Committee, Minerals Resource Rent Tax Bill 2011 [Provisions] and related bills, March 2012, p 33.

[11]      Professor Henry Ergas, Economics Committee Hansard from MRRT inquiry, 21 February 2012, p 1.

[12]      Australian Government, GST Distribution Review, Terms of Reference, www.gstdistributionreview.gov.au/content/Content.aspx?doc=tor.htm. See the discussion in the majority report and also in the Australian Financial Review, 9 January 2012.

[13]      GST Distribution Review – Final Report, page 123.

[14]      GST Distribution Review – Final Report, page 130.

[15]      Professor John Quiggin, Submission 1, and Prosper Australia, Submission.4.

[16]      The Minerals Council assert ‘mining was the only industrial sector to expand in Australia during the December quarter 2008’; Submission 5, p 5. Actually ten other industrial sectors also expanded; agriculture, construction, retail trade, transport, rental and real estate services, professional services, public administration, education, health care, arts and recreation, and ‘other services’; Australian Bureau of Statistics, Australian National Accounts: National Income, Expenditure and Product.

[17]      Minerals Council of Australia, Submission 5, p 2.

[18]      This not true of all large mining companies. Fortescue Metals Group did not pay any company tax until December 2011; Mr Marcus Hughes, Head of Tax, Fortescue Metals Group, House Economics Committee Hansard, 9 November 2011, p 6.

[19]      Dr Martin Parkinson, 'Introductory remarks to Australia-Israel Chamber of Commerce', Sydney, 7 March 2012, p 9.

[20]      Dr Ken Henry, Senate Select Committee on the Scrutiny of New Taxes Hansard, 22 November 2010, p 39.

[21]      Peter Greagg, Parham and Stojanovsk, 'Disparities in average rates of company tax across industries', Economic Roundup, Winter 2010; and John Clark, Peter Greagg and Amy Leaver, 'Average rates of company tax across industries revisited', Economic Roundup, 2011, Issue 2.

[22]      Australian Government, The Resources Super Profits Tax; A Fair Return to Our Nation, 2010, p 10.

[23]      Mr David Flanagan, Managing Director, Atlas Iron Ltd, Senate Economics Committee Hansard of inquiry into MRRT, 22 February 2012, p 8.

[24]      Minerals Council of Australia, Submission 5, p 3.

[25]      Minerals Council of Australia, Submission 5, p 3.

[26]      Association of Mining Exploration Companies, Submission 2, p 2. The current Queensland Government has announced a freeze of royalty rates for ten years (Submission 3, p 2) but this does not bind future governments.

[27]      Mr Peter Colley, National Research Director, Construction, Forestry, Mining and Energy Union Economics Committee Hansard from MRRT inquiry, 22 February 2012, p 33.

[28]      Fortescue Metals Group, Submission 26 to the Economics Committee inquiry into the MRRT, p 5.

[29]      Professor John Quiggin, Submission 1, p 1.

[30]      Professor John Quiggin, Submission 1, p 1.

[31]      Professor John Quiggin, Submission 1, p 1. According to Treasury, Western Australia was a ‘claimant state’ in 33 out of 48 years and a beneficiary of the current revenue-sharing arrangements for 18 out of 30 years while Queensland has benefited from the current arrangements in 26 out of 30 years; response to question on notice SBT 311, Economics supplementary budget estimates, October 2011.

[32]      Minerals Council of Australia, Submission 5, p 3.

[33]      Queensland Government, Submission 3, p 2.

[34]      The WA Treasurer argued in a letter to the Committee that he did not want to ‘lend any credibility to the bill by making a formal submission’; 24 October 2012.

[35]      WA Treasurer to Committee; 24 October 2012.

[36]      NSW Government, Submission 6, p 1.

[37]      Senate Standing Committee for the Scrutiny of Bills, Alert Digest, no 11 of 2012, p 17.

[38]      Submission 2, p 2 and Submission 6, p 1.