Gov t plays down MRRT failure
Minister Simon Crean.

UPDATE 9.25am: The Federal Government is playing down reports its new mining tax has failed to raise a single cent of revenue in its first three months.

The government has estimated it will raise $2 billion from the minerals resource rent tax in 2012/13.

But first quarter tax receipts, due on Monday, show Australia's three biggest miners - BHP Billiton, Rio Tinto and Xstrata - made no payments, The Australian said today.

It was estimated that BHP and Rio alone would provide between $1 billion and $1.5 billion in MRRT payments in 2012/13.

Cabinet minister Simon Crean denied the lack of revenue was a "body blow" to Treasurer Wayne Swan's $1.1 billion surplus forecast.

"Arguing that this is a failure based on the first three months is just ludicrous," he told the Nine Network.

"It was never projected to raise (revenue) in the early part ... because these mining companies are making massive infrastructure investments, which are tax deductible."

As well, there had been a sharp drop in commodity prices.

The opposition is not convinced, saying the government brought forward its mid-year budget review to avoid revealing the true state of the mining tax revenue.

Shadow treasurer Joe Hockey said the government's economic strategy was in a mess.

Mr Swan had "frauded" the Australian people over the tax and had some explaining to do, he said.

"Only Labor could introduce a new tax that doesn't raise a single cent but has billions of dollars of expenditure against it," Mr Hockey told ABC radio.

The Australian Chamber of Commerce and Industry attacked the timing of the tax, labelling its implementation a flawed process.

The chamber's director of economics and industry policy, Greg Evans, said the government had rushed the tax, and as it turned out the mining boom had peaked earlier and lower than expected.

"Certainly I think timing hasn't been in favour of the government on this one," he told ABC radio.

Liberal MP Kelly O'Dwyer would not say whether the lack of revenue in fact contradicted opposition claims the MRRT would kill the goose that laid the golden egg.

"It says that it wants to hinder one of our most profitable industries, that is incredibly important to Australia,” she told Sky News.

"We say it's ill-thought through, it's ill-defined, it's not going to work."

Labor MP Graham Perrett said revenue would flow when resource companies started meeting growing aspiration demand from the ever-growing middle classes in China and India.

"In the quarters ahead, I'm sure that the revenue will increase,” he said.

Opposition Leader Tony Abbott said the mining tax had “damaged investment, damaged confidence and created perceptions of sovereign risk - but it hasn't actually raised any revenue".

Speaking to reporters in Sydney, he condemned it as a “lose-lose tax".

"Only the Labor party could introduce a confidence-destroying, investment-destroying tax and then not raise any money,” he said.

"This is the extraordinary feature of this monumentally incompetent government that they could have the worst of all possible worlds.

"They can introduce a new tax which does massive damage to our reputation overseas, which does massive damage to investor perceptions of Australia, and then so botch it that they get no revenue from it.

"Yet the spending associated with the mining tax continues apace.”

Asked if it was too soon to write off the tax as a failure, Mr Abbott said the government could not have “any real confidence of getting revenue in subsequent quarters”.

The West Australian

Popular videos

Our Picks

Follow Us

More from The West