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20/10/14
13:11
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Originally posted by ferronium
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The single biggest so-called 'subsidy' to mining is the low rate of fuel excise tax. The reality is this isn't a subsidy. The purpose of the fuel excise tax is to pay for public roads and associated infrastructure for the public to drive on. Mines don't have paved public roads, they have private dirt roads within the mine area created by the companies for their own vehicles. Some mines even have private dirt roads that go from the mine to a train loading facility, which can be up to 100km away. All paid for upfront and maintained by the Co's. This is not a subsidy!
Other countries operate variations on a theme. New Zealand sells diesel 'road tax free' at the pump. But all diesel vehicles that drive on public roads have a wheel odometer fitted and a couple of times a year the vehicle owner has to fill in a usage form and send a cheque to the Gov. This system has the great advantage that diesel cars do little wear/damage to roads so are taxed at a lower rate than trucks (higher rate) which do most of the damage to the road. So the miners diesel haul truck and the farmers diesel tractor don't require these and don't pay road tax.
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There are a lot more subsidies being paid to mining than the fuel excise rate.
Figures released earlier this month by the Productivity Commission show the mining industry received $492 million in direct subsidies last year.
But senior economist with the Australia Institute, Matt Grudnoff, says if you include tax concessions provided to mining companies, the amount of subsidy is almost ten times that figure.
http://www.abc.net.au/news/2013-06-25/nrn-dist-mining-subsidies/4778042