Business says no more tax hikes

Western Australia’s peak business lobby has called for a quick end to debate over imposing higher taxes on mining sector profits.

The Chamber of Commerce and Industry WA (CCIWA) said it was concerned by a call today from the former chair of the ACCC, Rod Sims, to introduce a resource rent tax on the mining sector.

Mr Sims suggested the Albanese government could have gone harder in taxing the resources sector at a time of high profits.

He was speaking one day after the Albanese government said it would introduce changes to the Petroleum Resource Rent Tax.

The changes are expected to increase tax receipts by $2.4 billion over the forward estimates.

The changes include a limit on the proportion of PRRT assessable income that can be offset by deductions and recognise that aspects of the PRRT are better suited to oil projects than LNG projects.

The Australian Petroleum Production and Exploration Association (APPEA) reacted positively to the government announcement, as the industry had feared a much larger impost.

“The changes aim to get the balance right between the undeniable need for a strong gas sector to support reliable electricity and domestic manufacturing for decades to come and the need for a more sustainable national budget,” APPEA chief executive Samantha McCulloch said.

“The announcement today will provide greater certainty for our industry to consider the future investment required to maintain both domestic and regional gas supply security for our customers.”

CCI chief economist Aaron Morey said “we strongly caution against tapping the resources sector for additional revenue to suit the Federal budget as and when required”.

“These views are troubling to Western Australian businesses and many across the Australian community,” he said in reference to Mr Sims.

“Our nation had this discussion 15 years ago and very clearly sided against changing the goal posts mid-game for the resources sector.

“It is critical that debates about the PRRT and other regulatory costs for the minerals and resources sector are now settled.”

Mr Morey said some people appear to need a sense check on how fundamental the resources sector is to the national economy.

He likened the debate over mining profits to the GST debate.

“This is the same mistaken argument that is applied to the GST, which sees funds arising from the effort and development of one state, as belonging to another,” he said.

“It’s worth reminding every Australian that just 70 cents comes back to WA from every dollar our state contributes to the Canberra GST kitty.

“This is not special treatment."