It's consistent with the government saying more marginal mining operations benefitting from the new tax. Personally, I can't see how it makes economic sense to make marginal mines less marginal. It goes against all economic principles of money moving to the most efficient industry. Anyway, how is ore valued at the point of extraction? More complexities and yet they're meant to be simplifying the tax system! It really does seem the govt. is going for RIO and BHP. I reckon that the government has come up with a tax that claws back the additional profit per ton that the big miners were able to extract out of the Chinese to match the landed price of Brazilian ore(what is it about $20 per ton?). Effectively, BHP and RIO being back at the ore price of the Brazilians. I'm not particularly concerned about BHP/RIO's plight and their complaints about their current mines being unfairly valued for this new tax, given that they've been completely and utterly duplicitous in terms of rail access for the juniors. They're not interested in having any competition, even though they say mining is critical to Australia's future. I don't agree with the tax, particularly the taxpayer having to wear 40% of investment costs should a mine close due to it being unprofitable. It will be crippling for the nation's coffers should the commodities cycle plummet in a few years. The RSPT may not come into force, but we'll still be screaming at BHP/RIO for not allowing access on their lines.
BRM Price at posting:
$3.27 Sentiment: None Disclosure: Held
