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Wednesday, 5 October 2011

SUPER MINING TAXES ARE WRONG, BUT STATE MINING ROYALTIES OK

Why don't the politicians and former Treasury Secretary Ken Henry be honest and tell the market why they really want a super mining tax? How can a government determine the basis of calculating a super profit is and why would it only apply to mining companies and not banks who make super profits by gearing the use of bank deposits to earn REAL SUPER PROFITS. I'm not saying it should be illegal or unfair or excessive to make super profits in banking or mining, but why or how would government decide or calculate a super profit?
The reality I suggest is that with so many foreign companies taking over mining companies there is a real risk that corporate tax take is going to disappear through price transfer arrangements to the new owners country of origin. I'm suggesting the only way to combat this problem is for the States to increase Royalties, which would favour the mining states...thus causing the federal taxing dilemma.
What do you think?

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