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Tuesday, 22 November 2011
Page: 13356


Mr CHRISTENSEN (Dawson) (20:07): Through the actions of this government, we have witnessed the trashing of democracy in Australia. In promising not to have a carbon tax and then doing the exact opposite—when it could cobble together a half-baked government—the Labor Party rendered democracy pretty much useless. The voice of the people was silenced and we witnessed the trashing of democracy.

But democracy will be restored at the next election, and introducing this new mining tax will ensure that the restoration will be just as painful for Labor as the four years Australia has had to endure this government. The last time a government sought to impose extraordinarily unfair taxes on miners, it gave rise to a movement known as the Eureka Stockade, which is credited as the birth of democracy in Australia. So history repeats. In the lead up to the Eureka Stockade, the government imposed heavy taxes on the entrepreneurs, the miners who were spilling their blood, sweat and tears on the goldfields in Victoria at Ballarat. In return for the heavy taxes they received—wait for it—nothing. The government saw an opportunity for a quick money grab, took it and gave back nothing in return. It was no wonder then that those brave miners took up arms against the government. At that time, they had little choice. The Eureka Stockade, where miners drew a line in the sand and said, 'Enough enough is enough,' was such a defining moment in Australian history and laid such an enduring foundation for our culture—including the concept of a fair go—that Australians are still rallying behind that notion of rebellion. But here we are 157 years later, and what has this government learned? Nothing.

Eureka parallels a similar story in the United States of America where the famous Tea Party patriots demanded 'no taxation without representation'. We may well be demanding something similar here, because history is repeating itself. This government just simply cannot help itself. Someone is making money, the Labor Party thinks. 'We cannot have people earning a living digging stuff,' say the Greens. 'We will tax it,' is their first and only answer. This is an ill-conceived tax from an illegitimate government; make no mistake. Even the previous Labor government, the one that had some legitimacy, started this rot. The funny thing is that that government was knifed, and that Prime Minister was knifed—

Mr McCormack: In the back!

Mr CHRISTENSEN: because of the carbon tax and the mining tax—and, as the member for Riverina says, 'in the back'. Here we are with the two-faced Labor-Greens taxaholics imposing exactly that: a carbon tax and a mining tax on the Australian people, who are not so dumb that they cannot see the self-defeating nature of these two taxes. The general public has enough nous to know that this mining tax—a deal done with the three biggest miners in this country—is unfair and discriminatory.

Even today they are still chopping and changing what the tax is and how it works. In the Australian today we find out that an attempt to raise the threshold to $75 million was another failed attempt to cover up a botched plan. It is a dog of a tax, and putting a different collar on it will not stop it from being a dog of a tax. The small mining companies, the ones not allowed to have any input, do not care what colour the collar is, because they know that they will be getting it in the neck.

We can be sure that the big three miners will be gaining a competitive advantage out of this deal. They will have made sure that their hide is looked after. The combination of the mining tax and the carbon tax will make Australia the highest taxed mining industry in the world. That will make Australia about as attractive to mining companies as broccoli to five-year-olds.

Mining companies are global concerns, and there are plenty of countries in the world where they will not be taxed to death. An interesting report came out in September from Deloitte Access Economics, suggesting that a more 'creative' method of calculating tax was used by Treasury to back their claim that the mining industry paid just 27 per cent tax. That was the claim Treasury made during the debate over the failed superprofits tax. The Deloitte report found that the minerals industry paid an average tax rate of 41.5 per cent between 2007-09 and 2009-10, and that should scare off most of the potential investors.

Even China is scared. Chinese diplomat Ouyang Cheng warned, in the Age on July 7 about the difficulties this mining tax would impose on Australian-Chinese economic cooperation:

''There are some worries from the Chinese mining enterprises regarding newly released MRRT [minerals resource rent tax] bill,'' he said.

This government has been warned, and the warnings are coming from people who know far more about mining and far more about economics than anyone in the Labor Party or the Greens will ever know. They have been warned.

But this muppet government presses on. This furry Labor glove with a green hand inside and a couple of limp independent strings attached is trying to tell us that this tax is about fairness and equity. They would have us believe it is about 'spreading the wealth'. They froth and bubble about our 'patchwork' economy. They had to stop talking about a 'two-speed' economy because it did not fit the story they wanted to tell. So now it is about a patchwork economy because—surprise, surprise—different industries are in different cycles. I have got news for this government. There has always been a 'patchwork' economy in this country. We have just never had a government so addicted to tax that it sought out any industry rising to the top of its cycle so they could tax it into the ground.

Here is a question: what happens when the cycle turns, as it inevitably will? How will this government fund the milk and honey they are promising when the well runs dry? Which industry is going to be next? The Leader of the Nationals was in this place earlier, posing the same question. If agriculture—an industry that has been flogged around the bottom of a cycle—were to come good and somehow start to make good profits, would this government introduce a great big farming agriculture tax? Absolutely, because there is no tax that the Labor Party does not like.

But while the small miners and the Chinese investors are worried, perhaps the Treasurer and, for that matter, every taxpayer should be worried as well. This mining tax is supposed to raise $11.1 billion over three years, and of that this government is going to spend every penny and a few billion more.

Only the Labor Party could introduce a whopping great tax that actually costs more money than it is going to make. They did it with the carbon tax and now here they are doing it again with the mining tax. But it is going to get worse because the mining companies are saying that they are not going to pay the tax if they can help it. So the $11.1 billion is at the mercy of the accounting policies of the very large mining companies, who have a duty to their shareholders to deliver as much post-tax profit as they can get. Certainly, we know that the big three are not going to pay any tax at all, and the government has let that happen.

But it will get worse. The state governments are going to raise royalties, and some already have. They have to, because this Labor government flatly refuses to fund vital infrastructure where it is needed. We have seen Western Australia and New South Wales make their moves, and now South Australia is going to follow no doubt. When the big one, Queensland, follows—that will probably happen with a change of government—we will see. But I tell you that the states are moving. They raise just nine per cent of state revenue through royalties in Queensland, compared with WA, which raises 20 per cent of state revenue through royalties. When a fair dinkum government comes in to clean up the mess in Queensland, there will no doubt be an increase in those royalties. Or, maybe the Bligh Labor government will come to itself and raise the royalty stakes right now, all of which the federal government will have to refund to the mining companies. So the mining tax is suddenly turning into this bigger and bigger loss. The $11.1 billion is suddenly dwindling—going down and down. But it could become a lot worse, because the world is facing a new financial crisis brought on by excessive government debt—something this government should be very acutely aware of.

Another economic global concern will affect demand for resources and therefore profits. Where will the money come from then? Remember that these guys are promising milk and honey will rain down on the land from this mining tax. Superannuation is going to be increased from it, they say. They seriously think that people will suddenly think taxing an industry will make us all the more wealthy because their superannuation contributions will be increased. 'The roads will be paved with gold,' they say. 'We are spreading the wealth,' they gush, 'to businesses not in the booming resource industry.' Let us take a closer look at that plan. It is not the government that is going to be paying increased super. It is businesses that are going to pay increased super. Far from spreading the wealth to businesses outside the resource boom, this government will be, effectively, taxing them. That is right: they will manage to smack down the booming industry, while still managing to smack down other industries and small business as well.

Mr McCormack: And claim the credit!

Mr CHRISTENSEN: That is right—and claim the credit, as the member for Riverina says. They try to fob us off with a line about lowering company rates to offset the increased employment costs brought in by super changes, but who is going to believe that line? I can tell you that we will not fall for that. Thousands of small businesses that are not companies will not believe it for a second—those that are small traders and those that are in partnerships: Bob the plumber, Uncle John and Aunty Betty at the corner store. They are the small business who will pay this super tax directly, because they employ a lot of people across this nation. Or they did until now; because when employment costs go up something has to come down. I can tell you that many of these businesses are already on the edge. They are marginal now and cutting back on personal expenses themselves. They are waiting for an opportunity, though, to grow their business. But if there is another expense they will have to lay off staff or cut costs, or they will just go and shut up shop and look for a job somewhere. And if there are none, they will probably become yet another person on the unemployment line.

What this ridiculous tax and superannuation plan will do is introduce a different patchwork in the economy. What is worse is that this government is trying to claim credit for the superannuation. What really sticks in my craw is this concept that the mining tax is going to deliver for regions. What a joke, and what an absolute rort.

We have seen how Labor fails on that scorecard with the Queensland Labor government. Queensland already taxes the mining industry—it is called royalties. All the hard work—the sweat, the toil and the effort—and all the blood and tears in North and Central Queensland contributes to the state economy and to the national economy. All the burden that families bear, all the wealth-producing effort, delivers more than $2 billion in royalties just through the coal ports of Abbot Point, Hay Point and Dalrymple Bay in North and Central Queensland alone.

And what do we get in return for that? Zero, zilch, nothing. That money is funnelled straight into the south-east corner. We have seen attempts to spread that wealth, but it does not get spread around. It actually just gets funnelled. If this same foolish plan is put into federal Labor hands, we know too well in Central and North Queensland what will happen. It will be used to fill the gaping void that currently prevents Wayne Swan from getting a surplus. It will go down to Sydney or a bit further to Melbourne. None of it will come back to the wealth-producing centres.

How do we know? Let us take a look at the forward estimates. The mining tax raises, as I said, $11.1 billion over the next three years. What comes back to regional Queensland—the big wealth-producing area, apart from WA? The best they can offer is a handful of transport infrastructure projects. There is something good in here: $160 million for a ring road in North Queensland; $120 million for safety upgrades on the Peak Downs Highway, although it will actually cost three times more than that to deliver; $54 million for an intersection in the south-west of the state; $50 million for a port access road in Gladstone; $40 million for an intersection upgrade in Central Queensland; and in my electorate I am stuck with a $10 million study. Great!

But I am being pretty generous here because not all these projects are actually linked to the mining tax. They are regional projects that will be funded over the lifetime of the forward estimates where the MRRT is supposed to collect $11.1 billion. These projects total $434 million out of a tax take of $11.1 billion. That is less than four per cent returned to one of the greatest mineral wealth states in Australia. If that is a fair share, I would hate to be sitting at the dining table when Swanny's carving up the corned beef. I am a big fella, and I suspect that when the Treasurer thinks that four per cent is a fair share I would be getting this little sliver of silverside and I would probably have to fade away to a shadow!

What a rort—$11.1 billion out, with the large bulk coming from Queensland, and only four per cent back. Ripping $100 out, giving four per cent back and saying that is fair—what a joke! Fairer faces emerge from the underground at Oakey Creek, covered in coal dust from head to toe.