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Wednesday, 22 August 2012
Page: 6094

Minerals Resource Rent Tax

Senator MILNE (TasmaniaLeader of the Australian Greens) (14:28): My question is to the Minister representing the Treasurer, Senator Wong. Does the minister recall in March this year the Treasurer, Mr Swan, said that refunding mining companies for increases in state royalties would not change any of the mining tax revenue forecast in the first two years. Given the Treasurer has now written to state governments threatening that the Commonwealth will implement measures to protect the revenue from recently announced or future royalty increases, can the minister confirm that the $13.4 billion expected revenue over the forward estimates from the mining resource rent tax to the Commonwealth is under threat?

Senator WONG (South AustraliaMinister for Finance and Deregulation) (14:29): I have to say I anticipated this question from Senator Cormann, but I thank Senator Milne—

Senator Fifield: All roads lead back to Mathias!

Senator WONG: I have no response to that. It is—

Honourable senators interjecting

The PRESIDENT: When there is silence we will proceed. Senator Milne is entitled to hear the answer.

Senator WONG: First, it is the case—

Opposition senators interjecting

The PRESIDENT: Order! Senator Wong.

Senator WONG: It is the case, as has been reported, that the Treasurer has written to the state treasurers on the issue of royalties to remind them of the government's position in relation to increases in royalties. As the Senate may or may not be aware, the New South Wales government has announced it will increase rates and the Queensland government is also indicating a royalty increase is in the spotlight in its September budget.

I make this point: it would be interesting to see if the Queensland Liberal senators advocate as strongly against that tax as they have against the minerals tax—

Senator Brandis: We have a $65 billion debt to pay off.

Senator WONG: Oh, so a state Liberal mining tax is fine, is it, Her Majesty, but a Commonwealth profits based tax that delivers to Australians? That's bad! This is an extraordinary proposition.

Anyway, I return to the question from Senator Milne. I have previously indicated to Senator Milne in relation to the minerals tax a number of points. The first is that it is a volatile tax. Obviously, as a profits based tax, movements in volumes and prices obviously affect the tax take. The government is of the view that we do need to seek to resolve these issue with the states, which is why the government has written, through the Treasurer—

Senator Joyce: Mr President, I rise on a point of order on proper titles. It is about Senator Brandis. Minister Wong continues to throw what is an acerbic comment and one that we know full well she is not capable of taking herself. If she cannot take it, she should not throw it at Senator Brandis.

Senator WONG: I get called much worse than that by you!

Honourable senators interjecting

The PRESIDENT: Order! When there is silence we will proceed. Senator Collins.

Senator Ronaldson: Give your pay back. You're a thousand bucks a word.

Senator Jacinta Collins: That just makes my point. Maybe Senator Joyce cannot hear the nature of some of the interjections up this end, but for him to be making that point absent what we all hear coming across the chamber from the other side is, I think, ridiculous.

The PRESIDENT: There is no point of order, but I do remind, as I did earlier, that honourable senators need to refer to people in both this place and the other place by their correct titles. The minister has nine seconds remaining to answer the question asked by Senator Milne.

Senator WONG: Thank you. As I previously indicated, the budget estimates were $13.4 billion, as the senator has indicated. That was a revision down in the first three years, and we will update— (Time expired)

Senator MILNE (TasmaniaLeader of the Australian Greens) (14:33): Mr President, I ask a supplementary question. I take from the minister's answer that revenue over the forward estimates from this tax are under threat. Will the minister now admit that the government made a mistake in its deal with the multinational mining companies in agreeing to credit unlimited royalties and that the government should have supported the Greens amendment to limit the credit of royalties to those that were in place before 1 July 2011.

Senator WONG (South AustraliaMinister for Finance and Deregulation) (14:34): With respect to Senator Milne, I do not propose to traverse again what occurred in the context of the passage of the MRRT. I think the arguments for and against that amendment were traversed in that debate and I am sure the senator is aware of them. The government's position is as the Treasurer has articulated in this letter to the states, and I would point out that the independent GST review, which is looking at a range of issues, including this issue, noted in its interim report that it was:

… unrealistic for the states to think they can … capture the revenue stream generated by the Commonwealth's undertaking of a significant and challenging reform.

That remains the government's position.

Senator MILNE (TasmaniaLeader of the Australian Greens) (14:35): Mr President, I ask a further supplementary question. I thank the minister; but, given the obvious need for increased government revenue to fund reforms such as Gonski education, the National Disability Insurance Scheme and Denticare, will the government now agree that Australia needs the original Henry recommended resource superprofits tax to bring in the increased revenue of $100 billion in the next 10 years? Will the government now revisit the superprofits tax?

Senator WONG (South AustraliaMinister for Finance and Deregulation) (14:35): I am sure Senator Milne will not be surprised that my answer is no. The government has made its position in relation to this very clear. The government, as the Treasurer has indicated, does have a view about resolving this issue with the states. The issue that the independent review referred to in its interim report is obviously an issue that does need to be resolved, and that is why the Treasurer has written, but government is not proposing to agree with Senator Milne's proposition as put to me in that question.