*especially if as one poster argued somewhere that "without mining we would be a banana republic".*

Yup Fozz 2, that was me and in reality we would be. Take our
current account deficit, add another 100 bilion plus a year and
our lenders would treat us as such. Mining pays our bills.

*Umm guys, you're supposed to be avoiding Australia like the plague because of this "great big new tax" remember?*

Nope Fozz 2, that is not what they are saying. Railways are treated
as tax exempt btw. As I pointed out in my previous post, miners
will keep mining the mines that are already going. Its new
investments in new mines with new infrastructure, that is a
different thing and that is what people like Kloppers are saying.

The railway you quoted is servicing present mines, it makes sense
to own it

9 billion $ is not a storm in a teacup, its a great deal of money

The QLD rail network services most mining in QLD, present and future, unless the mine is a very short dump truck drive away from a suitable seaport. There is no other really feasable way to shift very large volumes of various kinds of dirt very long distances from outback mine to shiploader. Most future mines will also rely on rail.

Your argument then is that an offer of a colossal $5bn investment in an enormous piece of infrastructure that can never be packed up and taken away is a sensible financial decision for companies who have no intention of further expansion nor presumably increasing output from existing mines?

Your reference to the CAD as a stand alone figure has little meaning without context. Last I looked, there were countries with a relatively high CAD and a high standard of living (Australia, the US, the UK, New Zealand) and those with a low CAD but a low standard of living.

Fozz, the miners in the syndicate buying their own railway, would
have crunched the numbers. Divided between them, its not so much
per company. It really depends on what efficiency gains that they
can see can be made, to gain a return on their investment. The
mines are already there, they might as well own the rail too.
Any profits made on the railway, won't be affected by the mining
tax, as the company will be a separate entity.

The projects that won't go ahead is where new railways need to be
built, as in the iron ore industry, where they finance their own
rail, their own ports etc. Or projects like the expansion of
Olympic Dam in South Australia. Best to just rip the hell out
of present mines and with clever accountants, move as much money
as possible offshore. Most of these companies operate globally.

As to our current account deficit, in the end it has to be paid.
We pay it by borrowing ever more money, around 1 trillion $
right now, which our banks borrow, when they go cap in hand to
the money markets. If banks were not borrowing it, the RBA would
have to, for our nation's account have to be squared up regularly
and somehow we need to find the currency to pay it, or we do
become a banana republic. For just like a credit card, there
are limits that are eventually reached, which if we cross them,
our financiers will baulk at, as the Greeks have found out the
hard way.

At the moment financiers have good reason to keep lending to us,
to cover our current account, for we have a mining industry which
creates foreign currency, to repay it. Without the mining
industry, our currency would collapse, interest rates would
shoot through the roof and we could no longer afford to buy
medicines and all those other imports, which we depend on for
our cushy lifestyles.

I listened to Ken Henry in senate yesterday.

The rspt fund tax cuts for incorporated companies,about 30% business. Henry said research indicates tax cuts like this increase capital expenditure.

The other beneficiary will be the government spending program.

It is not to fund any superannaution contribution which is said will be financed by the salary and wages of employyes.

There are no numbers to support if this affects profits going offshore. Many analysts suggest it could benefit China who are often the only willing financiers of risky projects. It is fair to say there is no proof at all this will stop foreign owners making more from our resources, Henry said so.

The surprise one. Mining is in deep recession and the government stimulus saved the economy. So mining is not growing.

We cannot compare to Norway or need sovereign wealth funds because mining is such a small part of our economy. Norway is a one industry nation so Dutch disease arguments like the only Kevin Rudd actually tabled are wrong.

Overall tax rates are low but seems individual companies can pay very high tax. BHP for example pays 43% tax so those that will be hit by the tax could be already paying very high taxation. Averages do not seem useful for this industry.

So after Henry talk I ask what is the objective of this tax?

Does the tax and the government share the same outcomes? NO.

To share the wealth with all Australians?. NO.

To ensure our recources are paid for?. NO. Royalty is charged on whether the miner makes a profit or not so, this new tax removes that guarantee.

To fund increased superannuation contribtuons? NO

To subsidise corporate tax cuts for big business? YES.

TO help get government out of hole while blaming someone else.? YES

So essentially a plunder tax removing investment, potential jobs and cash flow from regional Australian and giving it to City business.

Simply a shift of capital from one part of the country to another.

So who is really greedy here?