All’s not fair in politics

Nicki says:

04:11pm | 05/06/10

John,
five stars( ***** )for your comments.Truth is truth and no matter what you try to do some people will nerve see it or understand it.

Roger Lamb says:

01:12pm | 06/06/10

All true. 

But not just of Australia.  Especially true of the U.S. 

The developing locus of political power is not the nation-state, but the corporation. 

So democracy is in the process of ceding to corporatocracy.  This is the Real new world order.  The bad news? - the people are okay with that.

Glorfindel says:

05:53am | 07/06/10

The irony is that the Greens look like being the big winners.  The Greens are likely to hold the balance of power in the senate. Won’t that be good for the mining industry.

Bruce says:

11:38am | 05/06/10

Pers: Agree with much of your comments regarding rusted on voters. Regarding “resonating much in voter land” it may depend on which circle you mix in, or are associated with. My experience with people who are involved in corporate finance, syndicated finance, banking, financial planning, taxation, mum and dad shareholders, superannuation, along with large and medium sized business, the issue is “resonating” quite significantly. All are examining the mining tax proposal, trying to understand what effect it has on them.  As you can imagine just from these examples alone there are a large number of voters who want to understand all arguements regarding the mining tax.

Adam Diver says:

01:02pm | 05/06/10

Theres no better example of non-rational voters than the post above Love the hypocrisy Perse it was hard to not think of it as satire

Diamantina Dick says:

02:47pm | 05/06/10

Great read Pers and I agree with everything you say except for your last point, certainly as it relates to the voterland in Cloncurry and Wondoan.

Labor’s issue at the moment is that a number of its “controversial” polocies have percieved macro benefits but very real micro impacts. Enough of those micro impacts can move 2% of the electorate and properly located that can change a Government.

marley says:

03:12pm | 05/06/10

I like your analysis, but don’t entirely agree with it.  Let’s face it, if you were really right about the percentage of people who vote out of habit or disinterest, there would never be a change of government.  And don’t forget, either, that a lot of Australians, myself included, are comparatively new to this country and are not “rusted on” anything, since none of the parties remotely resembles the ones in my former home.  We’re listening to the arguments on both sides and (in many cases) agreeing with neither - which is no doubt why the Greens are moving up the poll ladder. 

And I think that’s more the point - the argument is resonating in voterland, we just don’t buy the sales pitch from either side.

Richard says:

04:21pm | 05/06/10

Persephone, in fact almost none of what you have written is true:
According to Antony Green from ABC at least 30% of voters are swinging voters. On a personal level, I can confirm that I voted for Kevin Rudd in the last election, (literally! I was living in his electorate at the time), but I will not be do so again in the next election, and I believe I am not alone.

And the issue is not that voters are too dumb or ignorant (or don’t care enough) to understand the proposed tax either. Most ordinary voters do understand the exact ins and outs of the RSPT, (just like we did the ETS) and oppose it nevertheless. Its Kevin Rudd’s irritatingly smarmy attitude that he’s just so much smarter than the rest of us that underlies the breathtaking arrogance of this government. We voters are not stupid, but we know when someone is trying to treat us like we are.

Convoluted, complicated legalities and legislations (not to mention verbosities) in no way indicates superior workability (or intelligence). Its the simple, elegant systems and solutions, that are startlingly clear and effective, that just fit together with no apparent intellectual effort, that are always the best, the most efficient, and the most appropriate.

Take football for example. There are many different codes and rules etc. but the one form which is so popular that it dominates all others and whips the whole world into a frenzy when its major tournament is held (the World Cup) is, unsurprisingly, the one with the simplest most elegant rules. Its “the beautiful game” and its only rules are basically ‘don’t touch the ball with your hands’ and ‘try to get it in the goal up the other end’.

Now compare that to NFL American Football, which isn’t nearly as fun or popular on a global basis. Why? because its so convolutingly complex and needlessly ‘stop-starty’. (And don’t assume I don’t know all the rules of NFL, because I do, back-to-friggin-front, but its still not as good to watch or fun to play as soccer).

Well its the same with the tax code: simple is good. Any massive and desparately complicated new tax is bound to cause damage to the economy, and for what? So uncle Kevin can post us all another $900 in the mail? So Gillard’s army of rorters can erect sheds in schools? So more insulation installers can be electrocuted? The government seems to think that since we the people are the “rightful owners” of all these resources (as if we all become native title holders overnight), they have the right to waste the profits from it on our behalf.

Better to let the private sector be methinks, so that we can all reap real benefits, whether as employees, contractors, small businesses that indirectly benefit from a competitive mining industry, or superannuation account holders that have investments in this sector.

Darryl Price says:

05:14pm | 05/06/10

I think that THIS government believes it needs to explain the details of the idea to win people over. Otherwise, why advertise? You are in government, govern. Oh but we don’t have the conviction of our ideals to want to take any political pain. Yes well that could be a problem then…

watchingwithinterest says:

08:54pm | 05/06/10

Persephone I always find your opinion interesting but I have to ask, to have so much information you must work for the labor party or one of its associates.  I can’t accept that you do it for the love of it.  The sheer amount of time it would take you to read what you do and then post like you do means that it would be difficult for you to be holding any other job.  I think that its time for you to admit the truth - that you are part of the labor party spin machine.

buzz says:

07:41am | 06/06/10

persephone says:
try this on rusted on 42yrs smoker all gains made in the pension increase wiped out in one tax back to were i was under howard
insulation workers ensured a new scheme would be up and running in a couple of months then shit on by the pm the same man that assured them
asylum seeker policy back flip because his adviser believed what they read in news ltd press
shelf the ets when all he had to do was keep putting the bill before parliament better to be seen to be trying not running away
go on insiders tell australians you couldnt run a chook raffle but you will try to do better in the future
never have i seen a party cut its own throat so effectively

PaulB says:

09:59am | 06/06/10

Thats pretty good writing Pers, thanks.  I would argue that most voters are not fact driven but perception driven.  Information hits them everyday but perception change comes from the slow drip-drip-drip of good or bad news gradually forming an impression deep within the psyche.  Contrast Rudd’s election campaign and its positive messages with the stream of negatives that mark Rudd’s past year (you and I would likely disagree with the detail but we likely both agree that Rudd has taken a visible media beating).  These negatives become associated with the Rudd Brand, and this could see some otherwise disinterested voters take a stand against Rudd that they may not have done in a less media driven environment.  You’re absolutely right about “How to Vote card” lady though, I still remeber one in the line behind me telling her mate how “they orta do this like on computers an’ stuff coz it’s a pain havin’ t’ come all the way here just to vote” (God forbid that you should be inconvenienced by the very act of democracy).  Argument for non-compulsory voting?  Another debate another day.

John A Neve says:

02:23pm | 06/06/10

Whatchingwithininterest,

Not so, some of us take the way our country is being run seriously. You don’t have to do much research, just steer clear of the Dayly’s and watch other than the local news.

Weeny says:

03:32pm | 06/06/10

PERS,
Agree with what u say apart from the last sentence.  Thats why we must try really really hard to convince the 4% NOT to vote LABOR.  the worst government in our history.  RUDD is worst than Whitlam.  Rudd is a total liar and backflipper.  JULES is incompetent wasting billions on BER.  This super profit tax is going to cost thousands of jobs.  So now you got something right keep up the good work and start convincing the 4% not to vote Labor again.

persephone says:

04:33pm | 06/06/10

Bruce

If you were flat out meeting people every day, with enough time to establish their vacillations over the issue, I doubt you’d be able to truly assess the views of more than a handful, let alone the vast hordes you seem to be able to talk for.

It’s also very likely, people being what they are, that the people you mix with (on a good enough basis to work out whether this tax is concerning them or not) think along the same lines you do.

Which is why - although I occasionally dip into anecdotal incidents myself - the polls are all we can really go by, when assessing the impacts of various issues.

And, if anything, the polls seem to be stable or trending slightly upwards since this announcement was made.

Adam D

spoken like a true rusted on - you can’t even accept that I might be able to write of political matters from a non partisan viewpoint.

I’m always amused when I state something which is simply a fact (not saying the above is, though it’s based on sound research) and I STILL get attacked for being political.

Says more about you guys than it does about me.

Marley

last time the government changed hands with a swing of just over 5%. I may be a % or two out, but I’m not hugely.

If the number of swingers were bigger, you would get the occasional election where we had true landslides, in the region of 60%. Instead, a landslide in Australian politics is about 52% of the vote.

So the number of true swingers - not counting those who say they haven’t made up their mind before an election but then vote the way they always do - must be quite small.

As I said, it’s a guesstimate.

And, as I said, it’s the polls which suggest this issue isn’t having an impact of votes - which is a different matter from people expressing opinions about it, even negative ones.

DD

I agree. And lack of micro polling has brought governments down - Kennett in Victoria, for example.

We’ll see.

Richard

what I said to marley - we don’t have true landslides in this country because we don’t have huge shifts in votes from one election to the next, because our voting patterns are fairly stable (and, with all due respect to Antony Green, that’s why he’s able to predict the way a seat will fall from a handful of booth numbers).

Didn’t cast any of those slurs on voters, just recounting what research shows about the way we all tend to ‘go with gut’ and then use our intelligence to invent arguments to rationalise a decision we’ve arrived at on an emotional basis.

It actually worksas strongly with academic and other ‘experts’ - they’re better at rationalising! - so it has little to do with ignorance or lack of intelligence.

Ah, soccer. Just got back from watching my boys play. They’re both refs, too - and they still have trouble understanding half the decisions!

I’m not discussing the complexity or otherwise of the tax, but simply what the polls show is happening with people’s perceptions of it.

Daryl

which is what they’re doing.

Watching

why oh why won’t punch give me a bio down the bottom of the page? Then I wouldn’t have to do this so often.

I am a long term, very involved member of the ALP. I love politics, so that’s what I read about (reading ‘The Kennedys’ at the moment, as well as a book about the Tennessee Valley Authority, and have just finished ‘Risk’, an analysis of the role of emotion in the politics of fear).

I read really really fast and type really fast as well, so none of this takes me as long as you think it does. (You could work it out one day, there’s times on these posts).

Buzz

there were equal shock horror stories under Howard - particularly in his first term - but the media reported them differently.

But that’s another issue.

Paul B

yep, but also never over estimate how much attention people are really paying.

I’ve door knocked in the weeks leading up to an election, and the most asked question is always, “Oh, is there an election coming up? When is it?”

You and I are obviously interested and aware (and probably devastatingly attractive as well, or is that just me?) but most people aren’t.

persephone says:

11:04am | 05/06/10

1. No, they’ll make more money up until the point where they make over 10% of the profit they’re making at present. After that, they’ll pay a little more tax.

Mining is a long term investment. Investment in current mines was made several years ago. In that time, commodity prices have increased beyond expectations, so the investment is already yielding returns far greater than anticipated at the time.

A small dent in those returns won’t make any difference to their finances as they were originally committed on the expectations of a much smaller return in profits.

The proposal will, however, make it easier for marginal operations to stay afloat, by refunding their royalty payments and reducing company tax by 2%. This is an effective 8% advantage these companies didn’t have previously - so a mine which was just breaking even or making a slight loss now returns a profit equal to the bond rate.

2. Your friends ‘investing elsewhere’ are most likely going out of mining stocks altogether, if they’re getting out of Australian investments because of a tax which won’t be implemented for two years. All indications are that if this tax is passed, it will be taken up by other mining countries - so by the time it becomes operational, it will be effectively international.

And it’s not a case of coming to the government asking for a cheque. It will be a legal entitlement, not merely a promise of kickbacks.

Forest has made it clear that his decision to withdraw from projects will not affect jobs. His inability to raise finance was a problem specific to his company (and his difficulties in this area predate the tax proposal); his statements at the time show his confidence that others will be able to find the finances to take the project over.

Palmer has cancelled projects that no one knew were on the table - not even the stock market, which - if these projects were real - legally should have.

And to suggest that mining companies can find the same quality and quantity of iron ore they need in Canada is simply laughable.

Joan says:

11:46am | 05/06/10

Imagine if USA government susidised 40% loses for BP’s disastrous Gulf of Mexico oil well blowout- which is predicted to cost BP tens of billions of dollars- they would be shelling plenty, yet Rudd and Co want to take on this is the type of risk and cost for the taxpayer totally disregarding the recent ocean oil leak North Australia just last year.  How much would that leak cost the taxpayer?

persephone says:

09:15pm | 06/06/10

Joan

no, because it’s an up and running operation - the 40% bit is only in the exploration/development stage.

After that, the government’s only refunding royalties.

The kind of situation BP’s in, however, always poses risks for governments - the clean up has to go ahead, whether the company is solvent or not, so if (for the sake of argument; BP is big enough so that it probably isn’t a concern) the company goes bankrupt, then taxpayers are left leaving holding the baby, regardless of whether they’ve agreed to underwrite the operation or not.

antiperspirant says:

10:01pm | 06/06/10

Lie 1. “In that time, commodity prices have increased beyond expectations, so the investment is already yielding returns far greater than anticipated at the time.”

Also note that the government is now quite happy to come in as a silent partner for 40% effectively after all the risk is gone. Hence internationally Australia’s sovereign risk is marked up.

Glad you know the miners minds from when these mines were first opened decades ago.

Lie 2. “A small dent in those returns won’t make any difference to their finances as they were originally committed on the expectations of a much smaller return in profits.”

There we go kids socialism in action. Welcome to the sunny shores of Socialist Australia. Work hard and get shafted.

I love how pers is also a expert in mining finances from years ago to present. She knows exactly what they were thinking and the returns they expected.

Lie 3. “The proposal will, however, make it easier for marginal operations to stay afloat, by refunding their royalty payments and reducing company tax by 2%. This is an effective 8% advantage these companies didn’t have previously - so a mine which was just breaking even or making a slight loss now returns a profit equal to the bond rate.”

Check your maths it don’t work like that. What about the businesses that are not companies? They just miss out.

Oh and lets not go into the whole propping up unprofitable business thing eh. We can leave that for later. What pray tell happens in a recession. They going to write cheques to everyone? Can this guarantee be used as collateral at a bank? Hint: answer is no. Therefore it is basically useless in practical terms. Who plans to fail?

Lie 4. “All indications are that if this tax is passed, it will be taken up by other mining countries - so by the time it becomes operational, it will be effectively international.”

Disgustingly false. In fact the contrary is true. Look at Africa. Show ANY proof here. Lies.

Lie 5. “And it’s not a case of coming to the government asking for a cheque. It will be a legal entitlement, not merely a promise of kickbacks. ”

Legal till they change it when business and the economy is looking sick. What would happen to your precious stimulus if they had to bail out a whole industry in a recession. What a joke….L.A.W tax cuts. Remember Labor’s form here boys and girls. Love the choice of words pers.

Lie 6. “And to suggest that mining companies can find the same quality and quantity of iron ore they need in Canada is simply laughable.”

Actually I have no idea if this is a lie but I will wager that I know as much as pers does about the quality and quantity of iron ore in Canada. And I will also lay claim to knowing as much as pers about the viability and profitability of the Canadian iron ore market vis greenfield projects.

So unless she want to really show us her sources this is just a mischievous comment without basis and will be treated with the disdain it deserves.

I blow a huge raspberry at it. So there.

Thanks pers. Interesting set of non facts.

mtdd says:

12:21am | 07/06/10

“persephone says:11:04am | 05/06/10 - Mining is a long term investment. Investment in current mines was made several years ago.”
“Several years ago” is not longterm - many mines take decades to get into the actual exporting stage and rates of return are calculated over the projected life of the mine. A “profit equal to the bondrate” - is less than the cost of capital ie not worth it. “All indications are that if this tax is passed, it will be taken up by other mining countries - so by the time it becomes operational, it will be effectively international.” What is your evidence for this Pers? Another ALP theoretician..

persephone says:

11:13am | 05/06/10

SD: simple answer - apply a super profits tax.

The feds can’t do anything about the state royalty regimes without a lot of negotiation with the states - refunding the royalties is a lot quicker and simpler.

Oh, and much as any death is regrettable, and the use of them contemptible as a form of political argument, the government did reduce the death rate in the industry - and the rate of housefires as well - comparitive to past years.  So this strongly suggests the committee in Canberra did know what they were doing (just didn’t predict that a dishonest and desperate Opposition would politicise the deaths of workers and place the blame with the government, instead of their employers - some of whom are already being prosecuted for negligence).

Um, and I repeat for the Xth time: the budget getting back into balance has nothing to do with this tax.

The proposed revenues from the tax is being allocated to specific programs. If the tax doesn’t go ahead, the programs don’t go ahead; it’s revenue neutral.

The budget is getting back into black ahead of forecast due to better economic outcomes, lower borrowings than projected, and cuts to government spending.

Matt says:

11:56am | 05/06/10

Good comment Super D.

mtdd says:

12:24am | 07/06/10

“SD: simple answer - apply a super profits tax.”
6% or the bond rate - is not a superprofit. Enough of this ALP abuse of the English language.

Meta says:

09:34am | 05/06/10

Very true, the Australian People have a right to set the price for the minerals buried in our chunk of rock. The problem is that if we set the price too high, mining companies will simply start digging up other people’s chunk of rock. They don’t have to mine in Australia.

If you were in charge of a mining company, and you know that you’ll make more profit on a mine in Canada (or Zambia, or Brazil, or any of the hundreds of other countries with chunks of rock…) than one in Australia, where would you build a mine, hire workers, and pay business tax?

The RSPT will slow down mining in this country to a crawl, and tax revenue from mining will plummet, not increase.

stephen says:

02:33pm | 05/06/10

Nicely said, acotrel. I get tired of how rich this country is supposed to be, with our commodities, yet all Governments, State and Federal, still seem to be scrambling after crumbs when infrastructure spending is mentioned.
Folks, we are loaded.
We have everything going for us.
Great natural wealth, good climate, geologically stable and a damn nice people.
These overseas mining companies have to pay their way.
We are nut suckers. Never have been.

By the way, there has been talk of storing nuclear waste in this country. Not a bad idea. If it happens, charge ‘em to the hilt.
Any Miners wanna help out ?

Darryl Price says:

09:14am | 07/06/10

Two words - commodity pricing. We are not Coles or Woolworth. Look them up

Evan Findlay says:

01:18pm | 05/06/10

Wayne is this the same Galaxy poll that said Howard would win the 2007 election, the same Galaxy research organization that said Springborg would win the Queensland state election!!!! In Queensland we don’t rate the so called expertise of the Galaxy polls.

“The system of royalties on tonnage has weathered well” If that is the case then why did the mining council submit to the Henry Tax review that it was antiquated and was a tax on productivity? Why were they the ones to suggest a Rent Resources Tax?
Once again Wayne you clearly demonstrate through your comments that you are unable to research a topic and you continually misrepresent fact for opinion.

Wayne Fehlhaber says:

05:55pm | 06/06/10

Evan :  Heh heh heh , had the poll favoured Labour you would have been quoting it to us , wouldn’t you ?
My argument is not with the mining council , if they like another plan that’s fine , but if we stay with state royalties and simply raise the rate of levy per tonne it is just as effective as a tax collection without destroying the industry. Don’t try misrepresenting my words simply to water down my argument against Rudd’s plan to tax mining out of existence.
Now to Labor’s RSPT -  Tell me Evan , has the mining Council indicated any support for the RSPT ?  I don’t think so. !
Have Australians generally , indicated support for Rudd’s plan. ?
Once again , i don’t think so. !  Polls continually show the electorate’s growing concerns on the devastating repercussions of RSPT .
Loss of vital investment , exploration , expansion and the inevitable flow-on to allied industry , and of course , the key issue in the electorate the loss of thousands of potential jobs for those trying to get into the mining industry.
You obviously believe yourself a guru with your judgements of my research on topics which i chose to debate , so i look forward to the answers to my questions which i have put to you.

persephone says:

09:22pm | 06/06/10

Wayne

except polls don’t show this. They show growing uncertainty about the tax, but they don’t show any shift of voters into the ‘against’ column.

And that’s the result of analysis of several polls, over the last month.

And yes, as I’ve demonstrated here before, the Mining Council supported the idea of a profits based tax, and miners interviewed at the recent shinding in Canberra repeated the same thing.

They just don’t want to pay more tax, which is perfectly understandable, because nobody does.

antiperspirant says:

08:06am | 07/06/10

“except polls don’t show this. They show growing uncertainty about the tax, but they don’t show any shift of voters into the ‘against’ column.”

53-47 to the coalition in the one that counts.

Sort of says it all.

Nervous much? How is the mood in the offices today? Bit worried? Jools wearing new clothes? Phone calls made? Busy lobbying?

5 weeks to go for Kevvie in my estimation. I started the 6 week countdown last week remember.

Evan Findlay says:

10:55am | 07/06/10

Wayne,
No I would not put my faith in Galaxy, no matter which way it spun. Even compared to the latest Fairfax polls they are wide of the mark.

You continue to argue for a royalties based scheme which is unproductive and as I pointed out not the preferred taxation scheme of the mining council. It was the mining companies that offered the rent resources tax to the Henry review. Their argument is not with the policy per se but with the tax rate, the level at which the tax kicks in and the fact that it will be applied to current mining operations whereas they only want it applied to future operations.

One can only wonder if they know of some downturn in the industry in the near future. After all China is looking very flaky in the current climate and already has a huge oversupply of our minerals and resources. With world demand still in decline and with China’s domestic demand always been notably low, the Australian mining industry might be in for some tough times. The RSPT would suit them in such hostile conditions as their tax obligations would be lower in comparison to the royalties based scheme which would continue to tax them at the same rate even though their profits are considerably less. Hence why the royalties based scheme is a tax on productivity whereas the RSPT is a tax on profits.

You still seem to favour the views of the mining industry, and that is fair enough, but as I see it, both the government and the mining companies are grandstanding. As a South African mining representative stated last week, “Where do these mining companies think they will bet setting up their mines? With large expanses of mineral rich land already being mined or under lease, where do they hope to dig? To me, the mining companies are simply politicising the loss of “potential” jobs, and as I stated earlier these are not actual jobs so as of yet there is no actual loss.

I do not agree with the way Rudd has handled the consultation, or lack there of, process but the tax has exceptional merit in economic terms and it’s value to the Australian business sector. Lowering company tax, larger write off’s for small business, superannuation and infrastructure spending to rid the economy of bottlenecks that lower productivity. For example, for every ship that sits off our coastline waiting to receive it’s load of coal, the mining company is fined up to $10,000 a day. The previous government failed to provide the funds to improve the ports, the mining companies don’t put in, even though it’s to their benefit so the bottleneck remains. The infrastructure spending announced by the government is beneficial to mining industry, but we don’t hear about it. The royalties taken by the state government are rebated by the Federal government, we do not hear the mining companies talk about that. We do not hear the mining companies talk about the lowering of their tax rate. All we hear from the mining companies it how their massive profits will be downgraded to huge and that jobs that don’t exist, won’t exist. Hardly a convincing argument. Similar to your argument Wayne.

My point is how can I judge your research when you obviously do very little. Your comments are merely opinion and not based on facts.

mtdd says:

12:29am | 07/06/10

The CEO’s of the various mining companies are governed by the Corporations Act hence have to be careful in the comments they make to the media (Palmer probably being the exception!) ie I would tend to think the likes of BHP etc are being honest in their commentary. No such limitations are applied to Rudd and co. Don’t forget, capital is mobile and will go where the largest returns are. Changing the tax system midway through the life of a project is not smart. Calling the heads of various companies “liars” and “ignorant” is not smart either - unless one is deliberately playing politics - but of course Rudd and Co wouldn’t do that would they?

Rocket Surgeon says:

05:29pm | 06/06/10

FFS. A retrospective tax is one that applies to past earnings or deductions. Changing the tax rate for future earnings is NOT retrospective!

mtdd says:

12:38am | 07/06/10

It is retrospective in the sense that it applies to current projects that have not been costed on changes to how they are taxed. It is also damaging as, for instance, longterm mines that have already fully or mostly depreciated their capital equipment will be hit the hardest - being unable to claim deductions.

From Alan Kohler: “Another big accounting firm, Deloittes, has gone through ATO data and demonstrated that the effective tax rate for Australian mining companies (company tax plus royalties) is 41.3 per cent, compared with the average across all sectors of 27.18 per cent. I went into the ATO website and did the same calculation: it’s true.

In one of its taxpayer-funded advertisements, the government says: “Before the last boom Australia got 1 in every 3 dollars of mining profits in royalties and resource charges, we now receive just 1 in every 7 dollars.”

This statement is a disgrace, even leaving aside the fact that we are paying for it. Of course royalties have fallen as a percentage of profits as mines have grown in scale and efficiency – that’s why you have corporate income tax as well.

At 41.3 per cent, Australia’s effective tax rate is roughly average among global mining tax regimes – a bit more than most, but less than some. According to KPMG’s modelling the new average effective tax rate with the RSPT rises to 56.9 per cent for iron ore and above 50 per cent for all other minerals – clearly the highest in every case.

The government has explicitly acknowledged the need for competitive tax rates in reducing the overall company tax rate from 30 per cent to 28 per cent, but apparently this does not apply to mining – the industry on which much of our future prosperity will be based.

There are three parts to this disaster:

1. The fact that it would raise the effective tax rate to the world’s highest for mining projects and therefore curtail new development;

2. The way it was introduced with no consultation or warning, which has separately damaged Australia’s reputation among all global financiers as a stable, sensible place to do business;

3. And the way the government now seems to think it’s in a political battle with global mining leaders – a battle it can win through advertising spin and lies, as it usually does against political opponents. But these are people who make decisions based on arithmetic and risk, not emotion or public opinion.”

Shelley says:

04:22pm | 07/06/10

*blush* Should be Peter Gattett