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Amec calls on opposition parties to support repeal of carbon tax, mining tax

Monday, 03 March 2014   (0 Comments)
Posted by: Author: Leandi Kolver
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Author:  Leandi Kolver (Mining Weekly)

The Association of Mining and Exploration Companies (Amec) on Monday called on opposition parties to support a repeal of the carbon tax policy, which had been before Senate since December last year.

Amec said that, following the release of the Climate Change Authority’s ‘Targets and Final Progress Review Final Report’ on Sunday, Environmental Minister Greg Hunt had reiterated that carbon tax was a poor public policy, stating that "the carbon tax is inflicting massive damage on Australian households and businesses but it simply does not work”.

Amec CEO Simon Bennison said that the costs imposed on industry by the Clean Energy Future Plan, which was implemented on July 1, 2012, was significant and had to be removed to restore some of the lost international competitiveness that Australian mining companies were currently faced with.

"Amec has consistently stated the carbon tax would impose significant costs and inflationary pressures to Australian businesses, consumers and the economy,” Bennison said.

When the Tony Abbott-led government took over from the Labor-run government last year, it vowed to abolish the carbon and minerals resource rent tax (MRRT) and released draft legislation to do so. Opponents to the carbon tax say that it will handicap Australian operations and make the country less competitive as many other resource jurisdictions do not have such a tax.

In South Africa, Finance Minister Pravin Gordhan last week delayed the implementation of carbon tax by a year to 2016 to "allow for further consultation”.

Bennison further said that the MRRT was another "poorly designed, discriminatory and refutably bad tax” that had to be rescinded and replaced with a long-term tax strategy that encouraged investment and was internationally competitive.

"Given the government’s clear mandate provided by the Australian public at the September election, Amec calls on the opposition parties to also support the repeal of the MRRT legislation, currently before the Senate,” he said, adding that these poor policy decisions had dented much needed investor and banking confidence in the Australian mineral exploitation and mining industry.

"To reverse this trend, the government must not only repeal the carbon tax and MRRT but also honour its pre-election commitment to implement an Exploration Development Incentive (EDI) by July 1, 2014.

"When the EDI is finally introduced it will provide a much needed boost to investor confidence and free up equity capital for investment in greenfield exploration,” Bennison said. 

He added that ongoing investment in greenfield exploration was essential to enable junior exploration and mining companies to discover the "mines of tomorrow".

"The repeal of the carbon tax and mining tax, as well as the introduction of initiatives such as the EDI, will go a long way to recovering some of the lost competitiveness that has occurred over the past few years,” Bennison concluded.

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