Bull PointsRio & BHP were both trading at historical discounts...

Bull Points

Rio & BHP were both trading at historical discounts prior to announcement - they have both shed 8-10% in the past two days. While the tax will have a material effect on profits it must be close to priced in at this point

While the tax would be significant I believe that it only applies to Australian operations. Both miners have significant operations overseas

If this legislation is passed they have a couple of years to deploy more free capital overseas before being hit with the tax

This legislation may well not be passed. On the surface it seems that it would have a devastating effect on the Australian resources industry (with much more incentive for deployment overseas) that it will be met with considerable opposition both inside and outside parliment

In all honesty, I can't believe our government would propose something so ridiculous. It seems to lack a complete understanding of business fundamentals