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.
A group of small and medium-sized miners met with independent MPs in Canberra today to explain their opposition to the tax.
Mr Forrest said the government had not thought through the tax.
If it had, it would not be asking Australia's smallest mining companies to pay a "much, much higher rate" of tax than the world's biggest mining companies.
"It discriminates against the small miners," Mr Forrest told reporters, adding it was deigned to protect the biggest companies only.
Prime Minister Julia Gillard struck a deal with BHP Billiton, Rio Tinto and Xstrata to develop the MRRT, replacing the even more contentious 40 per cent resource super profits tax last year.
But Mr Forrest said the biggest mining companies would not pay any tax for "the foreseeable future".
"It will instead crush the developing sector," he said.
Acting Prime Minister Wayne Swan later scoffed at Mr Forrest's claims, deriding Mr Forrest for “parading” around as a small miner.
"Mr Forrest is here today and he was part of a press conference and he claims to be a small miner," Mr Swan said during question time.
"We should call a spade a spade.
"He's got a $20 billion company! A $20 billion company is not a small miner."
Mr Swan was responding to a question from Western Australian Nationals MP Tony Crook who asked that the government guarantee in the legislation that small miners won't have to pay a higher rate of tax or pay earlier than their bigger rivals.
Mr Swan insisted the tax was fair.
"This tax does not discriminate against small miners and will be paid predominantly by very large miners," he said.
BC Iron managing director Mike Young, however, said his company would make history next year when it became the highest effective taxpayer of the MRRT.
"BHP and Rio Tinto will be paying a lower effective tax rate than us," he told reporters, adding all his company was asking for was fairness.
"We want to pay the same effective tax rate as everyone else."
Atlas Iron managing director David Flanagan said the issue was not about smaller miners objecting to paying more tax when they were profitable.
It was that they were being subjected to a taxation regime that was highly complicated.
The big miners, who were part of the negotiations with Ms Gillard, had a massive advantage over smaller miners.
"That makes it much harder for companies like us to start, survive and grow," Mr Flanagan said.
Magnetite Network executive director Megan Anwyl said magnetite producers would continue to persist with efforts to gain an exemption from the mining tax.
“It is not logical to impose a new compliance burden on an industry that, in the Minister's own words, will be liable for little or no tax,” Ms Anwyl said.
“Many projects are actively seeking finance and if there's no tax revenue to be had, why include magnetite at all?
“Not only do magnetite companies face significant and unnecessary compliance costs, but the mining tax, in addition to the carbon tax, compounds investor uncertainty and causes negative sentiment.”
Chamber of Commerce and Industry WA chief executive James Pearson also voiced concerns that the design of the tax would hurt small- to medium cap miners.
“The MRRT and the recently passed carbon tax will place more burdens on the major resources projects that drive the WA economy. ,” Mr Pearson said in a statement.
“This is likely to have a flow-on effect to the nation’s prosperity as the government, and the rest of the nation, increasingly depend on WA projects to drive Australia’s growth.
"There are also concerns that elements of the tax design – the allowance rates and the $50 million threshold - will disadvantage small and medium sized miners."
