BHP Billiton Chief Calls For Stable Australian Tax Regime
Thursday, February 11, 2010
BHP Billiton’s chief executive, Marius Kloppers, following the announcement
of the mining group’s interim results, stressed the importance to Australia’s
mining sector of taxation remaining unchanged during the life of its long-term
Marius Kloppers did not refer to it specifically, but it has been speculated
recently in the media that the Henry tax review could have recommended that
the 40% petroleum resource rent tax, which is presently imposed on Australia’s
offshore oil and gas industry, should be extended across the whole of the country’s
mining sector. A possible national resources rent tax would replace the current
state mining royalties, which vary between 2% and 10% of mining company revenues.
The government has yet to release the tax review, but the speculation about
future mining taxes was begun in a speech by Ken Henry himself on January 21
when he talked of how Australia’s natural resources were only partly taxed
through company income tax.
Such a rise in taxation would obviously shrink the present and future net profitability
of mining investments in Australia that have already been made, or which would
fall to be decided upon in the future.
Kloppers pointed out that it is therefore extremely important for mining
companies when they make an investment to know that all of the costs involved,
including taxation, will be as projected throughout the long life of that investment.
He is reported as saying that a competitive and stable fiscal regime, as had
existed for the mining sector in Australia in recent times, was necessary to
maintain investment for growth.