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BAD TAX: Business groups say the MRRT is a wasteful impost that could hurt the WA economy

Tensions mount as MRRT debate begins

Parliament has begun debating legislation for the minerals resource rent tax, amid calls from Andrew Forrest for the federal government to reveal the scale of deductions given to the big miners, and vocal lobbying from business groups and small cap miners demanding exemptions from the tax.

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Osborne Park, WA
The Government is using false justification in bringing in this tax. First they say it will fund tax cuts to small business by lowering the company tax rate. False! When these companies pay out the profits to their shareholders they will have lower franking credits and end up paying the difference in their personal tax returns. Next it is to fund higher Superannuation for all. False! When Paul Keating brought in the first round of super at 3% employees had to forego pay rises as a trade-off for super. This time round employers will end up with a higher employment cost and there will be no gift from the government to cover this and it will end up being built into their overall remuneration and employees will again forego an increase in favour of higher super. And like most taxes there will be a significant compliance cost for small miners in calculating and remitting this tax and create uncertainty for those just starting out and raising capital. Why only tax Coal and Iron Ore? Gold is at record levels and Gold miners must also be making record profits. Why discriminate? Because the government can always later amend the legislation to include other mining operations later. Australia is creating sovereign risk for investors making us less attractive for future investment and appears to be aiming to kill the goose that lays the golden egg. And just to add insult to injury Julia Gillard has now offered to increase Australia's funding to save the Eurozone - basically offering to help bail-out Greece, when she cannot balance her own books. Labor has increased taxes all round in Australia, cutting super deductible super contributions in half, imposed a flood levy tax on individuals, imposed an Electricity(Carbon) Tax and now a Mining Tax. Government policy has also led to a significant reduction in overseas student education in Australia with this sector falling from 3rd largest exporter to 6th or lower export industry for Australia, done through bad visa policy changes and bad regulation of the International Student education sector. Only the Greens believe it is good to tax the hell out of everything and they support all these new taxes with the Labor Government. This Labor Government will never run a surplus and see the only way out of their own financial crisis is to levy taxes on good industries.

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