A statement by Minerals Council of Australia CEO, Mitch Hooke, says “the government is continuing to misrepresent the minerals industry’s contribution to Australia in making its case for the proposed 40% super tax on mining. It is grossly misleading for the Government to claim that the effective tax rates paid by wholly Australian and foreign multinational mining companies is only 17% and 13% respectively. It is also entirely at odds with the government’s previous statements acknowledging much higher effective rates, and the analysis of respected economists and market analysts.

“In its response to the Henry Review, the government said the Australian minerals industry paid only 17% tax –  days later this was revised to 27%. In reality, minerals companies are currently paying around 43% (depending on current state royalty rates) and after the ‘super tax’ it will be 57% – the highest in the world.

“Why does the government continue to resort to spin to justify its new super tax? Surely if the government’s proposal has merit it does need to resort to misleading and inaccurate representations of the minerals resources industry’s contribution to Australia’s economic and social welfare.

“To make its claim, the government is relying on a small 2009 American study, which was not commissioned as part of the Henry Review as the government implies. For the record, the real story on effective tax rates after the new super tax is:

• The effective company tax rate on so called “super profits” will be 57%
• The total tax burden according to Citigroup is 58% – 18% higher than our nearest competitor the USA and more than double Canada’s 23%
• The founder of Access Economics Geoff Carmody, in assessing the tax rate paid by investors in the minerals industry, says “the average Australian tax share of super profits is probably 60-65% or more…and foreign investors will pay up to 80% or more”.