Honestly it is sensible government policy if you have a close to a monopoly. Australia should have done it decades ago for iron ore. You want a sliding scale so you keep your monopoly and give certainty to miners.
The super profits tax proposed by the Rudd government was a similar thing and in terms of a national outcome it would have been a smart thing to do. But the mining companies fought tooth and nail against it.
Regarding the impact to NIC. The outcome is similar. While I haven't looked at the details or run the numbers it likely means that super profits that lead to $2-$3 a share are unlikely to materialise any time soon. But fair return on investment warranting a $0.80-$1.40 is a more likely outcome.
Not a great scenario if you bought during the exuberant NIC stage. But if you are looking to buy now then NIC prices are still a bargain.
NIC Price at posting:
58.5¢ Sentiment: Buy Disclosure: Held
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