19/05/2010 - 08:57

Abbott says mining tax plan 'insane'

19/05/2010 - 08:57

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The Rudd government's planned super profits tax on the resources sector is "insane" and throwing Labor out of office is the only way to stop it, federal opposition leader Tony Abbott has told the oil and gas industry.

Abbott says mining tax plan 'insane'

The Rudd government's planned super profits tax on the resources sector is "insane" and throwing Labor out of office is the only way to stop it, federal opposition leader Tony Abbott has told the oil and gas industry.

Receiving a rousing reception at the Australian Petroleum Production and Exploration Association conference in Brisbane, Mr Abbott said the coalition was the only thing standing between the industry and a $9 billion a year levy that would gut Australia's economy.

"We are a country which has to pay its way in the world ... and we pay our way in the world through our resources sector," he said. "Australia's future relies on those bulk carriers steaming north as surely as we once rode on the sheep's back.

"You'd think that given that fundamental reality, that any sane government would be doing everything it humanly could to encourage the resources sector to expand.

"But the current government has decided in its wisdom that the best way to encourage you to expand is to hit you with a great big new tax.

"It is a moonbeam from the larger lunacy - it is simply insane.

"The fact is that the good guys inside this government have lost. The people who are in charge are the people who think that it makes sense to wipe out the expansion of the resources sector."

Mr Abbott said despite widespread recognition that the tax would cripple future investment in the sector, the government simply could not afford to drop the plan.

Any backflip now would completely destroy its already crumbling political credibility, while its entire economic management plan depended on the funds it expected to reap from the tax.

"All that stands between you and this great big tax is the federal coalition ... and the only way to stop this tax is to change the government," Mr Abbott said, repeating that the coalition would rescind the tax if it were elected.

"We will never hit you with something like this, we will never do this to you because we have too much respect for your importance, we have too much respect for the right way of going about things to ever do something as foolish as this."

Mr Abbott, who has been dubbed 'Phoney Tony" by the government for his admission that his unscripted comments could not always be taken as absolutely truthful, then accused the government for being "misleading at best and (telling) outright lies at worst" its defense of the tax.

"This is not a government you can trust to be truthful," Mr Abbot said without irony.

In particular, he attacked the government's likening of the tax to the significantly less onerous petroleum resources rent tax applying to offshore oil and gas production.

He also attacked the government's claims that oil and gas production had surged under the PRRT, when most of that growth could be attributed to the North West Shelf project which is not subject to the petroleum tax.

Mr Abbott declined to take questions from the media at the conference, opting for a staged event at a Brisbane quarry site later in the day.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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