Labor has not learnt from the experience of countries like New Guinea, Zambia and Mongolia in its attempt to inflict a super tax on mining profits. All of these countries had to dump their super tax because it severely harmed jobs and investment across the economy.
The Leader of The Nationals, Warren Truss, said numerous other countries rich in minerals had already tried the same idea that Rudd Labor had come up with, but had then come a cropper.
Countries like Papua New Guinea, Zambia and Mongolia all put similar windfall profit schemes in place, and all of them have come to the realisation that they just dont work, Mr Truss said.
Papua New Guineas scheme lasted 35 years but was revoked in 2003. The industry up there is now rubbing its hands with glee at the thought of Australian mining becoming uncompetitive.
Mongolia introduced new mining taxes in 2006 but got rid of them last year. Zambias 25 percent windfall tax lasted only a year before it was dumped.
Zambian president Rupiah Banda was blunt last year about the effect the tax had upon his country. We must ensure that we do not kill the goose that lays the golden egg. There is little point in taking a few million in tax if thousands of jobs are lost as a result.
Similar quotes are coming from mining leaders in Australia, the Coalition, state premiers, mining workers, regional communities and vast numbers of other Australians. Yet the Rudd Government is not listening and wants to blunder on with its new 40 percent tax on the sector that saved Australia from recession.
Even the international ratings agencies are jumping in to criticise the tax. Moodys said overnight the tax could drive mining companies offshore by reducing their earnings by a third and making them uncompetitive compared to mining giants like Canada, Brazil and China.
Kevin Rudd, Wayne Swan and every other Federal Labor figure does not realise they are playing with our future here. Getting this wrong means less jobs, less investment, less prosperity and more debt for Australia.
This will be a central issue in coming months. Every Labor MP and candidate will be asked how the tax that other countries have rejected is going to be good for Australia, Mr Truss said.
