Australian Greens leader flags higher mining taxes

Australia's biggest miners could pay an additional billion Australian dollars ($900 million) a year in tax if the Australian Greens party wins the balance of power in the Senate at elections this week, the party leader said on Wednesday.Opinion polls show that the left-wing minor opposition...

Australia's biggest miners could pay an additional billion Australian dollars ($900 million) a year in tax if the Australian Greens party wins the balance of power in the Senate at elections this week, the party leader said on Wednesday.

Opinion polls show that the left-wing minor opposition party, which currently has five senators, will likely hold the balance of power in the upper house after elections on Saturday. Neither the ruling Labor Party nor the main opposition coalition is likely to achieve a Senate majority.

Center-left Labor, which is marginally ahead of the conservative coalition in most opinion polls, wants to impose a new 30 percent tax on the burgeoning profits of iron ore and coal miners if re-elected, raising an additional AU$10.5 billion in its first two years.

Opposition leader Tony Abbott has ruled out voting for the tax which he argues would deter investment in Australia's most important export industry and cost jobs.

Greens leader Sen. Bob Brown said Wednesday his senators will only support such a new tax if it cuts deeper into miners' profits than Labor proposes. He wants the tax to raise an additional AU$2 billion in its first two fiscal years starting July 1, 2012.

"This reasonable tax income will enable the Greens, unlike Labor or the coalition, to put AU$2 billion extra into Australia's education system," Brown told the National Press Club.

Prime Minister Julia Gillard was not immediately available for comment on Brown's demand.

Government plans to take a larger tax share of mining profits — which have benefited from the voracious demand for raw materials from Chinese and Indian manufacturers — damaged Labor's popularity in the lead up to the election.

Opinion polls show that the tax is particularly unpopular in the mining states of Queensland and Western Australia where Gillard and Abbott have concentrated their campaigning this week.

Gillard deposed Prime Minister Kevin Rudd in an internal party coup in June as he argued for a larger 40 percent tax on mineral profits. Miners had funded a national advertising campaign in which they claimed that the tax threatened Australia's mineral boom.

Gillard quickly negotiated a more modest tax regime which was accepted by Australia's largest miners: BHP Billiton, Rio Tinto and Xstrata.

But smaller miners remain disgruntled and have resumed an advertising campaign against Labor's tax plans.

Abbott cites a recent survey of 429 world mining chiefs by the Fraser Institute, a Canadian think-tank, that found Australia's ranking as a safe country in which to invest had tumbled in six months from 18th place to 31st among 51 nations due to the proposed tax.

"It's very important that on Sunday morning, Australians wake up free of the threat of this tax," Abbott told reporters in Queensland on Wednesday.

Gillard has accused Abbott of denying Australians a fair return for their nation's mineral wealth because he depended on mining companies for campaign donations.

More in Home