New Petroleum Resource Rent Tax
METGASCO is one of 320 companies which will be taxed under the Petroleum Resource Rent Tax after yesterday's announcement by the Federal Government.
The move will see the company, which is about to build a gas-fired power station in Casino, paying about 30 per cent more tax at the well head.
“The super tax scheme was unworkable,” Metgasco chief financial officer Glenda McLoughlin said.
“This tax regime is merely unpalatable.”
However, Ms McLoughlin said the move was a step in the right direction, but it still imposed a tax burden.
The new Minerals Resource Rent Tax will apply only to iron ore and coal in Australia, and will be capped at 30 per cent rather than the original 40 per cent proposed. Oil and gas projects will come under the current Petroleum Resource Rent Tax and will see them taxed 40 per cent on profits.
Ms McLoughlin said the new tax was not well thought out because it did not sup–port a lower carbon environment with gas being taxed at a rate 10 per cent higher than coal.
“It's one of the perverse outcomes,” she said.
The government had failed to consult broadly enough with the mining industry, she said.
“Small companies have been excluded from the consultation process with the government,” Ms McLoughlin said. It was disappointing the new scheme was not in keeping with the government's election promise to create a resource exploration rebate.
Labor had promised a ‘flow through' tax scheme which would earn investors tax credits.
Ms McLoughlin said the new tax scheme was the government's remedy to a damaging advertising campaign.