*It would be madness and counterproductive to eradicate profit as there would be no incentive - typical scaremongering tactics.*

Pelican, you like many on OLO, simply don't understand the fundamentals of this dispute.

The miners have never claimed that they are not prepared to pay
royalties on minerals mined. In fact they already pay plenty.
You seem to think not enough, fair enough.

What they want is reliability and integrity from Govt. If Govt
encourages them and even threatens them, as has happened,
to invest and develop, making the terms clear before they invest
billions, that is fundamental to this dispute.

They then know where they stand and can decide to take a calculated
risk or not. Or look at other alternatives globally. Or decide
not to proceed with anything. That is what happened with the
petroleum tax, Govt did show integrity and its paid off for all
parties concerned.

Not in this case, now. Govts have encouraged them, coaxed them,
threatened them, into risking 10s of billions of $ on local
developments. Now that they have spent all that money,
Govt is basically saying "bad luck sucker, now we'll screw you
for things that were never agreed on, but we will, because we can."

If anyone took you for such a ride in your life, you would be
screaming from the rooftops. What we now know is that the Govt's
word cannot be trusted. Miners might have to demand iron-clad
written guarantees from Govt in future, before investing another
cent.

Realise also that the mining companies are terrified that if one country gets away with this then the others will follow - or do you think Canada will let its citizens get ripped off? Mining is not a game that all nations can play - e.g. if its uranium you want then you only really have Canada or Australia to choose from ....(or hey - lets scrap some more nuclear warheads so we can pretend there is not a problem in uranium supplies to our current reactor fleet for a few years more). The nations that possess the resources have the upper hand and the companies just have to dance to that tune as the world's quality resources decline. I think that the Labor party realises that.

My thought exactly, it's a 'no brainer' of monumental proportions.

As the author rightly says, it's future mining projects which are at greatest risk.

Being in business myself, one thing many of us are mindfull of when considering expantion, is payroll tax and, PRT is 'chicken feed' in comparison to this one.

I just hope comon sense is adoppted here and the potential mess this could cause is identerfied.

Given the amount of 'substantiated objections' Krudd received over his plans to take a trophy to compenhagen and, considering this all fell on deaf ears, I doubt somehow this guy would ever admit to being wrong and see the tax for what it is.

A JOKE!

How many times can you say "Massive"?
Can the ex shadow treasurer tells what offshore petroleum or Gas projects have not happened because of the Supper Tax that these projects incur? Which btw is twice as much as what we are talking about here.

Trickledown economics doesn't work even the Yanks have turned their back on it.

Julie we can only dig this stuff up once.

*The nations that possess the resources have the upper hand and the companies just have to dance to that tune as the world's quality resources decline.*

Michael, that is exactly where people like yourself are mistaken,
as you don't understand the fundamentals of investment and risk.

A company like BHP does not have to do anything. Rather then
plough most of their profits, back into new projects, they could
simply keep their present mines ticking over and pay out profits
to shareholders. The shareholders would not complain!

If the potential net profits are not worth the risk, why bother
taking the risk in the firstplace? Best to park that money in
the money market, with no risk.

The ones set to benefit most from the change of rules are in
fact the Chinese. For they will be able to buy into resource
projects relatively cheaply, use a bit of good old Chinese
accounting and transfer price their profits clean out of the hands
of the Australian authorities. The average Australian will get
shafted all the way and they won't know a thing about it.

But as always, people learn the hard way.

After having spent his way into a hole, Kevin Rudd and Labor need money to get out. He fears increasing income taxes because that is a big vote loser, same for increasing the GST, so why not use the "class warfare rhetoric", as Julie Bishop correctly describes it, to tax the wealthy miners? Unfortunately for Mr Rudd,people are now too smart to fall for that one. They realise mining makes Australians more not less wealthy.

So Kevin is basically stuffed. He can't back down now because he will look gutless and he can't tax the miners because its unpopular and will lead to other problems.

Maybe he will have a sudden "health issue", probably a dicky heart, and slip out the back door.