http://www.theaustralian.com.au/business/mining-energy/super-profit-tax-to-boost-canadas-competitive-advantage-says-jim-flaherty/story-e6frg9df-1225862465958

AUSTRALIA'S proposed new tax on its resources industry could be a huge competitive advantage for Canada, according to that country's finance minister, Jim Flaherty.

He said the “easiest thing” for a politician to do is raise taxes, which immediately increases revenues, but limits growth.

Considering that most of the school buildings have cost 3 x the normal cost that would mean that about $10bn of the $16bn was wasted and this is to be taken from the mines.

My Super has dipped about 3% this week, How about you?

Dear Shadow Minister,

You might need to flesh this out a little.

From Wikipedia about the situation in the Canadian Frontier Lands which enjoys their best royalty arrangement;

"The royalty rate is determined as an incremental rate from 1-5 percent of gross revenues until costs have been recovered, at which point the royalty rate increases to 30 percent of net revenues or 5 percent of gross revenues. In this manner risks and profits are shared between the government of Canada (as resource owner) and the petroleum developer. This attractive royalty rate is intended to encourage oil and gas exploration in the remote Canadian frontier lands where costs and risks are higher than other locations."

The government's proposal was to hit profits at 40%. I would put them neck and neck with the Australian scheme better for start up companies.

Perhaps your super returns were artificially high with the rest of us propping it up by not getting our fair share.

Yet to be convinced this is a bad thing.

Henny penny syndrome very much apparent here.
Happy to let my super ride it out.
Media no longer wants anything other than headlines and rabbott is a fraud.
history will cringe as this country looks back, a better country for the tax on this sky is falling childish time.

The tax does not add to the cost of mining. The cost of mining a ton of ore is roughly the same regardless of price the ore is sold at. There is a temporary jump in the profit because of the greater demand at this time. These resources in the ground belong to all the people of Australia. They are entitled to a share of the increased profits which are not due to actions of the mining company but to increased global demand. Mining companies are not going to abandon Australia because it takes time to set up a mine even when ore deposits are discovered. Mining companies know that the demand will go down, and ore price will decline. At that time the tax on superprofits will disappear. I doubt that the tax will do anything but add to the amount of revenue to the government. I hope this revenue will be spent wisely and possibly reduce taxes in other areas where taxes are an unreasonable burden.

Minerals unlike meat, grains, etc are not perishable .

The Resource can remain at home !

If big overseas mine owners do not want to participate in Australian Mining and pay a reasonable tax for their huge profits let the minerals stay in the ground .

More Australian Ownership is what is required - it will come .

CSteele et al,

The super funds are the single largest investor in the share market. Shares which are traded internationally are based on the profitability of company. When the profit falls, the investors pull out, the shares fall, and the company finds it more difficult to borrow money to invest. While the fall is hard to determine, it would be roughly in line with the loss in return on share value.

The pensioners about to retire would have a very different perspective as to who gets a fair share of their super portfolio.

Both BHP and Rio have assets and fields overseas that compete for development money. The ones with the greatest return get the investment. The reason that other governments have reduced the tax burden is not out of the goodness of their hearts, but because they know they need to compete for investment, and that 25% of something is more than 40% of nothing. Africa is littered with mines closed after greedy governments tried to take their "fair share", and the companies refused to invest further.

The concept that minerals in the ground is money in the bank is a little naive, as the mineral price is presently at a peak and there is no guarantee that it will remain there.

That the tax is paid on the profitable mines, and that overheads and losses on exploration are not deductible mean that the effective tax probably will exceed 50%.