Australia and most other countries already have resource rent type taxes on the oil/gas sector. Why not also have one for the minerals/coal sector, as long as it is properly structured, especially for the bulk commodities such as coal/iron ore/bauxite? A properly structured MRT would ensure that the level of revenue raised would diminish as the returns from the mining activity fell away, and in this way it should be neutral in terms of determining whether or not to continue an existing mining operation. However, it would make new Australian projects less attractive relative to equivalent projects (assuming there is such a thing as full project equivalence ) in other countries with lower taxes.
With 83% of the minerals sector being overseas owned and almost all of the capital equipment as well as an increasing level of labour (if Gina has her way all the labour) being imported), I think that the benefits of a depleting resource should be shared across the community and some preserved for future generations who will not have the use of those resources. Norway has the right idea with a national investment vehicle that invests some of its oil revenue overseas so that the exchange rate does not rise too far.
I agree our govnuts are hopeless and introduce policies to misallocate resources, especially via the housing bubble and population explosion in the major cities many of whom are not supported by real jobs.
Anyway, we have common problems with most of the developed world, and they are not unique to Oz. Australia just happens to be more fortunate in that there are more natural resources relative to population. Give it time and we will look like Greece, no matter if it is Lab or Libs in office.
The sharemarket is not doing a lot, which is leading to frustration, especially by those who did not get set in December/early January in preparation for the run. Such is life. Maybe they will have proven to be the smart ones later on.
Some of the more spec goldies have done OK recently (but most have not). It is all about luck and selection. I have no idea how high or low the market is headed, but for now I am fully invested in goldies - until the next nerve shattering downturn I suppose.
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