Let me know if anyone has a view counter to this or debates any of the facts presented. Given the tsunami of rhetoric coming from all sides I thought it was time for a post on the facts.
MYTH:
The "super-profit" tax will tax miners a total of 40% on profits above the 10 year bond rate (5.7%)
FACT:
The marginal tax rate on all miners who make a super-profit is 57%
For example
if revenue = $100 and
Expenses = $50
Your profit = $50
You can then subtract depreciation, with the allowance - set at 6 per cent.
So if RSPT allowance = $3
You are left with $50 - $3 = $47
The $47 is taxed 40 per cent (the super tax).
So $47 x 0.4 = $18.8 and you are left with $ 28 .20
The $28.20 is taxed again at 28 per cent (the company tax).
So $21.20 x 0.28 = $7.90 and you are left with $20.30.
That adds up to about a total tax of about 57 per cent.
MYTH:
The mining tax will be used to fund superannuation increases
FACT:
Whilst the are plenty of government bureaucrats with super to pay, the total annual increment for them is only $250M and all other superannuation is paid by employers (including the mining industry). The cut in the company tax rate is designed to offset this, not the "super-tax"
MYTH:
"this tax is the same as the petroleum resource rent tax and that has caused no issues"
FACT:
It isn't - the PRRT applied only to NEW projects and kicks in only when profits are 5% ABOVE the long-term bond rate. Also the PRRT does not apply to projects that draw state royalties.
MYTH:
"the resources are owned by all Australians"
FACT:
onshore mineral resources are owned by the States, not the Commonwealth
MYTH:
"the super-profits levy was recommended in the Henry review"
FACT:
the Henry review never mentions the term "super-profits" and it recommended a corporate tax rate of 25% and the abolition of all state royalties to allow a resources rent tax. "Super-profits" was first mentioned by Marx is "Das Kapital"
MYTH:
"Miners only pay $1 in every $7 profit in taxes, as opposed to $1 in $3 ten years ago"
FACT:
Rudd conveniently left $80 billion dollars in corporate tax revenue off his figures. In fact, tax revenue from mining has grown 10 fold from $2.6 billion to $21.9 billion over the last 10 years. State royalties vary, but miners currently pay an average of $4 in taxes for every $10 profit they make.
- Forums
- ASX - General
- super tax myths and facts
super tax myths and facts
-
-
- There are more pages in this discussion • 92 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Featured News
LU7
Discover the strong preliminary feasibility of the Bécancour Lithium Refinery, showcasing resilience in a low pricing environment and a strategic plan to capitalize on future price recoveries