A mining boom has helped Australia avoid the worst of the global financial crisis but the government is now targeting big miners, such as BHP Billiton Ltd. (BHP) and Rio Tinto Ltd. (RIO), to help improve its budget position.
But Treasurer Wayne Swan is imposing sharp cost increases for these companies at a time when economic growth is slowing in both the U.S. and China, the world's two biggest economies, and amidst concerns about the fragile European economy and the future of member states' austerity packages.
Many companies and industry lobbies have warned that these measures threaten future investment and could throttle the goose that has laid Australia's golden egg.
In particular, the government is using a big increase in resource tax and receipts from a new carbon tax to swing the government's budget to a modest surplus of A$1.5 billion (A$1=US$1.01) next fiscal year starting July 1.
Receipts from resource rent tax are expected to grow substantially in 2012-13 reflecting the introduction of a mineral resources rent tax.
Total revenue from these taxes on resources will more than quadruple next fiscal year to A$7.16 billion from A$1.51 billion this fiscal year. Revenue from this source in 2013-14 will rise to A$8.19 billion then fall to A$7.38 billion in the year after, according to the government's budget papers.
Net receipts from the mineral resources rent tax are estimated at A$3.0 billion next year, then in subsequent years A$3.5 billion, A$3.2 billion and A$3.7 billion.
Over the forward years, revenue from resources taxes are expected to reflect the projected changes in the commodity price cycle and some additional oil fields coming on stream and paying the petroleum resource rent tax, the budget said.
The government's budget also includes receipts from the introduction on July 1 of a tax on Australia's biggest carbon dioxide emitters.
The budget estimates revenue from the carbon tax next fiscal year at A$4.02 billion, and in subsequent years at A$6.61 billion, A$7.31 billion and A$6.72 billion.
-By Ray Brindal; [email protected]; 61 (2) 6208 0902