Australian mining companies likely to pay 30% tax from July 2012

The iron and Coal mining companies in Australia are likely to pay 30% tax on profits from July 1, 2012, as a part of the newly proposed Mineral Resource Rent Tax (MRRT) introduced by the Labour government in the parliament.

The new tax is introduced to ensure benefits to all parts of the economy that aren't in the mining boom fast track.

"Today's introduction of the Minerals Resource Rent Tax legislation to parliament is an important step in the Gillard government's plan to lock in the benefits of the mining boom and deliver a fairer return from the nation's mineral wealth," said the ministerial statement posted on the website of Australian Treasurer Wayne Swan, reported Platts.



The profits gained by the mining companies in Australia for the year ended June 30, 2011 accounts for A$92.8 billion qand the companies are planning to an investment of A$430 billion in their assets.



According to Australian Treasury, the Australia-wide mineral resources profits tax is set to raise A$4 billion in fiscal 2012-13, rising to A$6.5 billion in 2015-16 and a total of A$38.5 billion over a 10-year period to June 2021.



The tax will be applicable to the miners who generates an annual profit of more than A$50 million.The Discounts for extraction costs and offsets for operational losses and state mining royalties will considerabily reduce the headline rate of the MRRT to 22.5%.