Brendan Pearson, Chief Executive, Minerals Council of Australia says that new research by Professor Sinclair Davidson of RMIT demonstrates that mining pays a substantial amount of corporate tax and does so at a high effective tax rate.

“Extravagant claims are no substitute for hard evidence.  And Professor Davidson’s analysis of Australian Tax Office (ATO) data debunks some of the myths currently in circulation.  He cites in this context the claim by former Treasurer Wayne Swan that the industry’s effective tax rate is just 15%.

Professor Davidson finds that:

“The mining industry pays a lot of tax and pays close to the statutory rate of 30% of its taxable income. The view that the mining industry is under-taxed is not supported by data published by the ATO – the government agency that administers the tax system and actually collects the tax revenue.”

The data show that mining paid A$13.6 billion in net company tax in 2012-13.  Despite accounting for less than 1% of liable companies, mining paid more than 21% of corporate tax (second after the financial industry).  Professor Davidson finds that since 2000-01 net company tax receipts from mining have increased 7.8 times, while overall net company tax receipts have risen just 2.4 times.

Professor Davidson’s paper shows that mining pays a higher average effective tax rate than the Australian average, by a significant margin.  “The argument that mining tax rates are lower than that of most (or even many) other industries is simply not true’, Professor Davidson concludes.

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