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Monday, 19 November 2012
Page: 8964

Mining


Senator SINODINOS (New South Wales) (14:17): My question is to the Minister representing the Treasurer, Senator Wong. Does the government stand by its estimate in the MYEFO that its mining tax will raise $2 billion this year and $9.1 billion over the forward estimates, despite the fact that none of the miners who signed the mining tax deal with the Gillard government have paid the tax for the first quarter of this financial year?


Senator WONG (South AustraliaMinister for Finance and Deregulation) (14:18): I thank Senator Sinodinos for his question. As he knows, the government has most recently updated its budget figures in the budget update in the midyear review, and that included some revisions to the MRRT. I have been asked a number of questions in this chamber since that time about those figures and made clear that those are the most recent budget updates and they reflect the assessment that the government and Treasury have made in relation to figures in the budget, including the take on MRRT revenue as well as other heads of revenue. It is obviously the case that we have seen consistent downgrades to revenue forecasts as a result of a range of factors. They have been well spelt out in the budget papers over the recent updates. It is also the case, as we have discussed in here previously, that we have seen a significant drop in commodity prices in the period between the budget and, I think it was, around September, and that has been reflected in the changed figures that the government has put into the midyear review. I would make the point that the government does release its monthly updates in relation to figures. I think that I released the accounts on Friday, from recollection. I will see if I can get some further information specifically on the MRRT figures for the senator, but I would make a number of points. Firstly, the Treasury will provide the final numbers to the government once they have complied with legal obligations and completed their analysis. As the— (Time expired)


Senator SINODINOS (New South Wales) (14:20): Mr President, I ask a supplementary question. Does the government agree with the modelling conducted by PricewaterhouseCoopers reported in today's Financial Review which reveals that the iron ore price would have to go up from its current price of around US$120 to US$140 a tonne for the mining tax to raise any revenue? Does that mean the government expects iron ore prices to rise to over $140 a tonne for the remainder of this financial year?


Senator WONG (South AustraliaMinister for Finance and Deregulation) (14:20): I think Senator Sinodinos has been around long enough to know that I am not going to give him an answer to a hypothetical question, which is what that was. What I was going on to say was that the government will release information on resource tax collections each month in the normal way, commencing from the October monthly financial report due out in December, subject to taxpayer confidentiality rules. I referenced earlier the drop in commodity prices which, as the senator might recall, was some 38 per cent in the iron ore price between budget and early September. The senator, unlike most on the other side, would also know that you cannot necessarily extrapolate the total annual take by multiplying the first quarter by four; taxpayers can vary their instalment rate in any quarter and the instalment rate is applied to revenue in each quarter, which varies from quarter to quarter, particularly when you see large fluctuations in— (Time expired)


Senator SINODINOS (New South Wales) (14:21): Mr President, I ask a further supplementary question. Given that the government's mining tax revenue estimates for the current forward estimates have plummeted from $22.5 billion when the mining tax deal was signed to $13.4 billion in the most recent budget forecast, to $9.1 billion in MYEFO—

Senator Conroy interjecting

Senator SINODINOS: and you know this is true, Senator Conroy; you know this is true—what action will the government take to offset the revenue impact on the budget if there is a further slippage?



Senator WONG (South AustraliaMinister for Finance and Deregulation) (14:22): Unlike those opposite, we have actually had to get on with the hard task of identifying savings, including to offset revenue downgrades, and we have done so.

Senator Abetz interjecting

Senator WONG: I will take the interjection from Senator Abetz because, as usual, he does not know what he is talking about. I remind him again: we are a lower-spending government than you were and we are a lower-taxing government. I know you do not understand statistics, but over the forward estimate period spend as a share of GDP is below or at 24 per cent of GDP. The last time that was achieved was the 1980s. And we tax less than you.

Those opposite seem to have forgotten there was a thing called the global financial crisis; and, had they been in charge of the place, we know what would have happened: massive unemployment and a recession because they do not like the fact that we engaged in a stimulus package. (Time expired)