TREASURY boss Ken Henry has taken the unusual step of issuing a statement today clarifying his view of the contentious resources super profit tax, saying it will grow the economy - including the mining sector.

“It is the strong and clearly stated view of Treasury that the resource super profit tax will grow the mining sector and the economy,” he said.

“The tax was constructed on that basis, and the modelling released with the tax package clearly demonstrates it. I therefore reject the premise of those reports.”

Dr Henry was referring to an article in The Australian that said Treasury was understood to believe the loss of mining projects - as threatened by some companies under the new tax - could have macroeconomic benefits by easing pressures in the national economy.

The proposed tax was recommended by Dr Henry in his massive review of the taxation system delivered to the Rudd government almost three weeks ago.

The taxation was proposed by the miners....

From Malcolm Turnbull...

...

Of course, if commodity prices are low, a miner may have large revenues, and hence large royalties, but little profit. So for many years the industry has argued that it would be better to be charged on a profit basis. In fact it made such a submission to the Henry review. [gus' bold letters]

The key issues for the industry were, first that any changed taxation regime should not be retrospective, only for new projects. Second, it believed any new tax should differentiate between mineral resources, as the royalties currently do. Third, it was concerned the rate not be so high as to materially increase the share of resource industry profits going to government, and key to this issue is, of course, the rate of return beyond which the so-called super-profits would be deemed to arise. If the long-term government bond rate is the benchmark return, the tax would be better named "the slightly better than thoroughly anaemic profits tax".

So while the government and the miners were always going to disagree on the rate of tax, there was plenty of scope for negotiation. After all the fundamental premise - royalties should be charged as a share of profits rather than of gross revenue - was agreed.

...

-----------------------

etc...

Turnbull goes on slamming the government for the failures of this and that, including the ETS, that rolled Turnbull for siding with it, that the Rudd government has decided to delay — because it does not have the numbers in the senate... Turnbull praises Abbott's emission reduction scheme which if anyone analyses in detail would see as flawed, full of half-truths with half-porkies... and reminscent of the shower of money that Turnbull himself was pouring on iffy rainmaking technology when he was minister for this or that...

Australia’s planned 40 per cent tax on mining "super profits" has set a benchmark for other countries weighing higher levies, reducing earnings forecasts for BHP Billiton and Rio Tinto and the attraction of mining stocks.

“It could create what the miners are now describing at a global level as a type of tax contagion,” said Tom Price, commodities analyst with UBS in Sydney. “They might levy a new tax at the miners in Brazil. Canada is another mineral province and South Africa.”

BHP, the world’s largest mining company, Xstrata and Rio said they are reviewing projects in Australia, the No. 1 exporter of coal and iron ore, after the federal government unveiled the tax earlier this month, saying a country’s resources belong to the people. Citigroup analyst Craig Sainsbury said Canada, Peru and Chile may be next.

“Resource nationalism” is a major risk facing miners in the next few years, Evy Hambro, manager of BlackRock Investment Management’s flagship World Mining Fund said last month.

----------------------------

from AAP

A mining explorer at the forefront of the geothermal energy race in Australia says any change to the proposed new mining tax will hurt.

Panax Geothermal announced on Thursday that drilling efforts at its Salamander-1 geothermal well near Penola in South Australia have officially produced steam.

The next milestone for the company is in June when testing will reveal if it can convert that steam to base-load power, which will be an Australian first.

Panax managing director Bertus de Graaf said the new mining tax regime would be good for the company as they would be entitled to a government rebate for its $15 million well.

"The mining tax will help any explorer including Panax Geothermal, if it was now in operation, at the end of the year, we would get about a third of the cost back from the government," Dr de Graaf told AAP.

"So from that perspective it's a very attractive proposition.

"(But) if they make alterations in the scheme, in the end it will all fall apart."

-----------------------

Gus: crying wolf about a good deal?.... Meanwhile:

----------------------

A CHINESE state-owned newspaper has called for the country to emulate Australia's proposed resource rent tax.

"A hint to this nation's policymakers: if they are looking for guidelines to the long-awaited tax reform, take a good look at Australia's latest plan to increase worker pension funds with a new tax on resource projects," said an editorial in the China Daily, the Communist Party's main English-language newspaper.

Several prominent Chinese economists including Justin Lin, chief economist at the World Bank, have previously called for some kind of resource tax to conserve resources and promote efficiency.

The China Daily editorial said such a tax should be introduced in the next five-year economic plan, which starts next year.

So many lies; corrupt and blatant misinformation has eventually taken over the very idea of democracy to a point where they (the media) decide who is who.

To our enemies, no matter who the media decides, we are their enemies also. The idea of having respect for the civilizations which provided our guide to a better and more organized society, is as Rumsfeld would have us believe - is the "old world".

So far, with unfortunate exceptions, the Australian people are still individualized that we think; reason and can usually identify a con. 

However, over the last decade, there has been a tendancy for our working families to go through the trauma of the Howard "New Order" WorkChoices which, they fortunately perceived as an almost slavish work force for the ultimate benefit of foreign "investors".

The Australian people have been hoodwinked by the Conservative claims that they had removed all debt from the previous Labor government.  What they - and the media - and the Labor party - did not say is that the Howard/Costello mismanagement by selling public resources, created a $750 billion foreign debt and I wonder why even the Labor party does not tell us what could happen if - for example - Goldman Sachs called in all their debtors?

To foolishly think that these debt amounts are in any way as dangerous as the Rudd Government's stimulus package is a fairy tale. Whatever independence we have should be nurtured and governed by the ultimate opinion of Australians for Australians.

COMMENT:  During the Menzies era of servitude to the Crown and the US, the use of Australia by Britain and America was to test atomic weapons.  And we, and our indigenous peoples have suffered the results

And Bob Hawke, in his declining years, has advercated that we allow our country to be a dumping ground for the world's nuclear waste.  Fair dinkum. 

Back to the garden John and Gus?

God Bless Australia but - I weep for my country.  NE OUBLIE.

The federal government has opened a new front of attack against miners in the fight over the proposed resource rent tax, saying multinationals such as BHP Billiton and Rio Tinto pay just 13 per cent tax.

Deputy Prime Minister Julia Gillard says the low effective company tax rate proves big mining companies can afford to pay more.

"These are the cold, hard facts - the truth," she told the Nine Network.

Domestic mining companies pay an effective company tax rate of just 17 per cent, Ms Gillard said.

"For the overseas companies, the multinationals, (it's) around 13 per cent.

"This is not a fair share and that's why we're moving to introduce the resources super-profits tax."

Ms Gillard admits the stoush over Labor's proposed 40 per cent tax on super-profits had become "fast and furious".

But she wants the community to be sceptical of the "fear campaign" being run by the miners, who have said the new tax could kill the industry, driving investment and jobs offshore.

"We'll keep having the debate," Ms Gillard said. "We're determined to get this done."

But the deputy prime minister admitted the resource rent tax introduced on the petroleum sector 25 years ago was "different" to the federal government's proposed super-profits tax.

---------------------

see toon at top...

from the ABC

The Opposition says the Treasurer has been totally irresponsible in claiming mining companies pay only 13 to 17 per cent tax.

Treasurer Wayne Swan and Deputy Prime Minister Julia Gillard both cited the figures yesterday as part of their latest salvo in the war of words over a new resources tax.

But the Opposition's finance spokesman, Andrew Robb, says the independent analysis is a working paper by a student from the University of North Carolina.

"They rely - in an attack on the icons of Australian industry, the reputation of Australia as an investing country - on a graduate's paper, which is a regression analysis," he said.

"It is a ridiculous basis on which to mount an attack. It's just a working paper, it's not even a thesis or a peer-reviewed piece of work. It's the politics of desperation."

Mr Robb says the Treasurer should ask the Australian Tax Office for the figures.

--------------------

Gus: I would not be surprised if the government boffins know the real figures from the tax department — and these tax on miners amount to between 5 and 10 per cent of profits... But amounts of taxes paid by companies should be available from their Annual Reports... Robb should know that... One of the tricks sometimes played by companies with contributors, partners and tax department is that to minimise profits while being profligate with expenses... People who decided to make a contract based on a share of profits rather than stick with royaties on output/sales, often get their pay packet burned to a cinder... if you know what I mean. Thus the government new tax on mining has a few pitfall and the government knows this...

see toon at top...

The foreign Mining giants are more than ever enrolled in the Liberal Party and have declared war on the Australian government – and therefore - the Australian people. 

Which ever way you put it, when a sovereign country is attacked, whether physically or financially, like Iraq and Greece – and the wealth of that country, should it be oil or gold or coal - is being exploited by tax avoidance – it is a direct challenge to the Government and its people and the resources they own.

Why risk the lives of citizens of the Mining Companies’ nations by invading militarily, when they can get what they want from the non-Australian Coalition?

The Liberal Party Corporations along with the foreign Mining Corporations will together command an awful lot of money to pay to the media Corporations for the express purpose of blackmailing the Australian people into electing the Coalition party.

Lets be fair dinkum here and discuss custom and practice.

1. The horrible 4 year plans of the Rudd government.  Since when is it illegal or risky for a Government to plan for the future? Even Russia had 5 year plans.  So Kevin Rudd has plans for our future which doesn’t suit foreigners?  Not even with an updated budget every election?     

 Aren’t these foreign Corporations arguing that they want “certainty” for the future?  No sir, they are saying that they want to control our future with the Liberals.

2   Foreign Investment.  This is the euphemism that the Howard “New Order” used to sell off our public assets and produce misleading surpluses.  When Howard and Costello took over in 1996, the foreign debt was about $A 190 Billion.  When they were defeated at the polls in 2007, that debt was over $A 700 Billion.

Since when is it illegal for the Rudd government to invest in Australia? The budget laid out the areas in wshich the taxes would be used to benefit all Australians – isn’t that an investment? And why must we apologize to foreigners?  Have they threatened to call in Howard’s foreign debt?

3  The risks of the Rudd/Swan/Tanner budget? There will be millions of dollars that the foreign Miners and the Liberal party will hand over to their friends in the media Corporations to get rid of the Australian Labor Government. Does anyone remember that Peter Costello risked $A 6 million public dollars in a gamble on the Financial market – and lost it?  No hassle from Murdoch there.

The worker families cannot hope to equal “the too big to go broke” mob and so protests,  possibly with their inevitable Vietnam Moratorium violence, will again return under a bastardized government and a new Thailand could emerge.    

One thing will certainly change – Howard’s “New Order’s” dependence on foreign interests will be re-established and WorkChoices will give our working families the option of “my way or the highway”.

God Bless the Australia of and for the Australians and send the foreign miners over to other exploited countries.  NE OUBLIE.

And in the land of the forty-gallon hats:

By PAUL KRUGMAN

So here’s how it is: They’re as mad as hell, and they’re not going to take this anymore. Am I talking about the Tea Partiers? No, I’m talking about the corporations.

Much reporting on opposition to the Obama administration portrays it as a sort of populist uprising. Yet the antics of the socialism-and-death-panels crowd are only part of the story of anti-Obamaism, and arguably the less important part. If you really want to know what’s going on, watch the corporations.

How can you do that? Follow the money — donations by corporate political action committees.

Look, for example, at the campaign contributions of commercial banks — traditionally Republican-leaning, but only mildly so. So far this year, according to The Washington Post, 63 percent of spending by banks’ corporate PACs has gone to Republicans, up from 53 percent last year. Securities and investment firms, traditionally Democratic-leaning, are now giving more money to Republicans. And oil and gas companies, always Republican-leaning, have gone all out, bestowing 76 percent of their largess on the G.O.P.

These are extraordinary numbers given the normal tendency of corporate money to flow to the party in power. Corporate America, however, really, truly hates the current administration. Wall Street, for example, is in “a state of bitter, seething, hysterical fury” toward the president, writes John Heilemann of New York magazine. What’s going on?

One answer is taxes — not so much on corporations themselves as on the people who run them. The Obama administration plans to raise tax rates on upper brackets back to Clinton-era levels. Furthermore, health reform will in part be paid for with surtaxes on high-income individuals. All this will amount to a significant financial hit to C.E.O.’s, investment bankers and other masters of the universe.

Now, don’t cry for these people: they’ll still be doing extremely well, and by and large they’ll be paying little more as a percentage of their income than they did in the 1990s. Yet the fact that the tax increases they’re facing are reasonable doesn’t stop them from being very, very angry.

The mood of the man (and woman) in the street is different to that of the opinion polls... Most Australians support the idea of a bigger mining tax, whether they understand the way it works or not. The mood is that Tony and his troops of grubby grab-alls have miscontrued the tax and that the miners are cry-babies or rich tantrumic brats...

The interview with Lindsay Tanner (25/05/10) on the 7:30 Report showed that he has a long range purpose while the instant gratification gangsters of the Liberal party would prefer looting the pockets of the little people like me at every street corners...

Adding Ms Bishop passport gaffe to the tally and Tony's admission he streches the truth to make a (porkied) point, hopefully we'll see a drop in the support for "TonyStruth" or "AbbottLies" which are the same porkied thingsters... Anyone who supports Tony can be defined as being in favour of lying, being in favour of greed at anyone else's expense and lives by the grand motto: "all for me and me for no-one..". Oh dear... That could mean most of us? Could it?

But the mood in the street shows more ethics than that... and it's comforting somewhat.

Treasury secretary Ken Henry has poured scorn on claims that the Federal Government's new mining super profits tax will push up consumer prices.

The Opposition has launched a strong campaign against the new 40 per cent tax, claiming in Parliament yesterday that it would raise the costs of houses, electricity and "baby bum talc".

Dr Henry was questioned on the tax by senators at a budget estimates hearing this morning amid speculation the Government was considering making significant changes to the tax.

Dr Henry took a swipe at the suggestion that the 40 per cent tax could hit households.

"A lot of people have suggested a profits-based tax will affect prices," he said.

"I learnt in high school, from the study of economics, that profits-based taxes can't affect prices."

Could this be the biggest con job ever visited on the Australian public?

Forget Ern Malley, the campaign waged by the mining companies against the original mining tax emerges as Australia's most costly national swindle, both in terms of the cost of the heist - $22 million for a six-week television advertising campaign - and the continuing hit to budget coffers - $60.5 billion in revenue lost over 10 years.

To put that in perspective, for every dollar the mining lobby spent fighting the tax with emotive ads, featuring wholesome-looking miners, it saved another $2750.

But far from cutting back on investments, BHP Billiton this week revealed its true intentions. In fact it plans to invest an additional $80 billion over the next five years, mainly in Australia, to expand its production capacity, despite the proposed, watered-down, mining tax.

Sure, this sum could have been even bigger if there were no tax at all, but $80 billion is still a substantial investment program, particularly in an economy running at close to full capacity.

To put that in perspective again, BHP Billiton will be spending more each year on new mines and equipment than the federal government will spend on the nation's primary and secondary schools (about $14 billion a year).

How did we let ourselves be convinced taxing miners' ''super profits'' would force them to walk away from some of the world's richest resource deposits? That so-called sovereign risk concerns would forever deter foreign investment in Australia?

That is now the $60.5 billion question.

Miners Took Taxpayers To The Cleaners

BHP was once famously called "the Big Australian"; its CEO Marius Kloppers evidently prefers "nominal Australian" for himself, at least when talking to US diplomats. As this nominal Australian smirked his way through the announcement this week of a record profit -- putting BHP-Billiton on track, according to one British newspaper, to record "the biggest profit ever made by a British company" -- he had the additional satisfaction of knowing his profit announcement would enrage those who had supported the Rudd government's RSPT.

The vast half-year profit unveiled by BHP -- the first of many to be revealed by miners this reporting season -- vindicates those who repeatedly pointed out that the mining industry -- far from facing the Armageddon predicted by the miners -- was in such rude health it could afford to pay the RSPT and more. Needless to say, that hasn't stopped their ardent propagandists -- for example, Business Spectator's Steve Bartholomeusz in Crikey yesterday -- from insisting, with not a skerrick of evidence, that agreement on the MRRT had unleashed a "wave of investment" by miners.

Still, no use complaining now. The British companies BHP-Billiton and Rio Tinto joined up with the Swiss Xstrata and the American-Saudi News Ltd (tax dodgers both) and engineered a best-practice example of regime change. The three miners then negotiated a hasty backroom deal with a desperate replacement Prime Minister that reduced the new tax to a pittance. They were in such a hurry that various undotted i's and uncrossed t's continue to require resolution months later.

The steady drip of record mining profit announcements will continue, each one serving as a reminder of the culpable ineptitude of this government -- the Rudd model, which wrote the How-Not-To book on tax reform, and the Gillard variety, which so cravenly surrendered to the miners.

Labor is now, deservedly, left with the consequences of its retreat to a half-baked mining tax. It is getting hammered by the Greens for not taxing the miners enough, and it is getting hammered by the Opposition for having any tax at all. And it's getting hammered by the media because of the fiscal impact of the switch from the RSPT to the MRRT, without a sufficiently savage pull-back on the expenditure associated with it. It's out in

Opposition Leader Tony Abbott has publicly rebuked one of his backbenchers, Mal Washer, who says he may support the Government's mining tax when it comes before Parliament.

Dr Washer's vote could be crucial with several of the independents still considering their positions on the controversial tax.

The Liberal backbencher, who retires at the next election, has told the Sydney Morning Herald that he could "potentially support a mining tax".

"We need to take some profits out of the mining industry to assist industries that are struggling in this country. It is a two-speed economy," he is quoted as saying. 

''I think an appropriately applied mining tax is a very good thing.'

"I don't have enough details yet to decide whether I will cross the floor. I could, but I am not prepared to decide until I know exactly what they are proposing."

Mr Abbott says he has not spoken to Dr Washer about his comments, but "there would be lots of people who would be letting Mal know that he's on his Pat Malone in the West," Mr Abbott told Macquarie radio.

http://www.abc.net.au/news/2011-10-27/liberal-mp-could-back-mining-tax/3603712

Of course Tony is completely stupid about this. At the last election, if you remember he was planning to GIVE THE "poor" MINING INDUSTRY 420 MILLIONS of tax payers moneys for whatever reason... Tony is a grandstanding idiot and the media loves him for it...

See toon at top and stories below it....