17/05/2010 - 09:26

Mining tax campaign ramps up

17/05/2010 - 09:26

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A who's who of Perth's business elite have appeared in a full-page advertisement against the resources super profit tax as BHP Billiton chairman Jac Nasser speaks out for the first time against the controversial tax.

Mining tax campaign ramps up

A who's who of Perth's business elite have appeared in a full-page advertisement against the resources super profit tax as BHP Billiton chairman Jac Nasser speaks out for the first time against the controversial tax.

Driven by the Chamber of Commerce and Industry WA, the advertisement is directed to Prime Minister Kevin Rudd and outlines the business community's concern's with the proposed super profit tax on mining companies.

"As leaders of business in Western Australia, we are deeply concerned about the impact your government's proposed new tax on the resources sector will have on our businesses and the local economy," the advertisement in The West Australian newspaper reads.

"As major employers in this State, we know that our success, like the success of so many others, big and small, depends on a strong and successful resources sector.

"We don't want that put at risk."

Eighteen of Perth's business leaders from various sectors were signatories of the advert, including Azure Capital's Mark Barnaba, Austal Group's John Rothwell, Alcock Browne-Neaves Dale Alcock, John Hughes Group's John Hughes and The Brand Agency's Steve Harris.

Resource leaders were also featured including Fortescue Metals Group's Andrew Forrest, BHP Billiton's Ian Ashby, Hancock Prospecting's Gina Rinehart, Rio Tinto's Sam Walsh, Alcoa Australia's Alan Cransberg and Macmahon's Nick Bowen.

The advertisement comes a week after Atlas Iron boss David Flanagan took out a full-page advert addressed to Mr Rudd stating his concerns regarding the RSPT and runs alongside another campaign driven by the Minerals Council of Australia.

Meantime, in a letter to shareholders, Mr Nasser said while BHP had no issue with a review of Australia's tax system, any reform must be conducted on sound principles and not destroy incentives to keep investing in the resources industry.

"Any reform must only apply to new investments: not to existing investments," Mr Nasser said.

"Additionally, any reform should not disadvantage the resources industry compared to other industries in Australia, and it absolutely must not disadvantage the Australian resources industry compared to other countries."

BHP said that the RSPT would see the total effective tax rate on the company's Australian profits increase from 43 per cent to 57 per cent, making the Australian resources industry the highest taxed in the world.

This compares to a tax rate of 23 per cent in Canada and between 27 per cent and 38 per cent in Brazil, Mr Nasser said.

"The proposed super tax fundamentally, abruptly and unfairly changes the rules of the game," Mr Nasser said.

The proposed RSPT would "seriously threaten Australia's competitiveness, jeopardise future investments and adversely affect the future wealth and standard of living of all Australians," BHP said.

As well, it would "unfairly impact communities and working families across regional Australia," the miner said.

BHP said there was an over-riding risk "that Australia could now be seen by the rest of the world as a less stable and less competitive place for long term investments.

"If this eventuates, the great work of Australians to build the strong economic foundation of the country over decades could be undermined, representing a crucial turning point for Australia."

BHP said it would work with other stakeholders to ensure the issue is debated.

As well, the company would assess its Australian operations and investment plans as details of the RSPT become clearer.

BHP Billiton would brief shareholders at a series of information sessions to be held around Australia, the miner said.

At 1100 AEST, BHP shares were trading $1.15 lower, by 2.98 per cent, at $37.49, on a day when the market overall was trading down by almost two per cent.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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