Infrastructure and mining investment concerns with the MRRT
Fortescue raises infrastructure and mining investment concerns with the Minerals Resources Rent Tax
Sydney, September 29, 2010:
Fortescue Metals Group Chief Executive Officer Andrew Forrest today said the Federal Government’s proposed Minerals Resource Rent Tax (MRRT) will stifle the urgent development of infrastructure so badly needed by Australia.
Mr Forrest said future investment in infrastructure is penalised by the MRRT because it doesn’t allow infrastructure investment to be deducted against the tax. The tax suits only those players who already have their own infrastructure and who have always denied third party access.
“The three big mining companies deliberately designed this tax with no tax deductibility for infrastructure,” Mr Forrest said.
“Without infrastructure access or investment there will be no new mines. These three big miners know this and they are trying to shut the door to new entrants.”
Mr Forrest said the MRRT Transition Policy Group’s inability to address infrastructure funding and construction, which is crucial to the development of new mines, jobs and export revenue, was a clear indication of the Government’s failure to recognize the impact of the MRRT on infrastructure development.
“The Government should encourage infrastructure development, instead they are inadvertently frustrating it,” Mr Forrest said.
“Under the proposed MRRT we will see the streets of Australia’s mining industry empty of mining companies other than for these big players. When you look back you can blame the MRRT when those streets are all called BHP and Rio.”
Mr Forrest said that according to mining analyst estimates, BHP Billiton, Rio Tinto and Xstrata will pay less than $1 billion in MRRT revenue to the Government in the first year, casting further doubt over the design of the tax.
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