Friday, 10 Jun 2011
It is reported that Magnetite iron ore miners will be forced to pay the full royalty rate as the WA Government moves to avoid a repeat of the costly concessions enjoyed by mining giants BHP Billiton and Rio Tinto for decades.
With Mines and Petroleum Minister Mr Norman Moore expected to make a decision within months on the rate magnetite miners will pay for the ore they export, it is understood the Government is set to impose the full 5% impost. The decision would come despite efforts by the fledging magnetite sector to win concessional rates of between zero and 3.5% for the first few years of production and collect hundreds of millions of dollars a year in extra revenue.
Although the Government has remained vague on the amount of money the tax would generate forecast production from WA's three leading magnetite players suggests a rate of 5% would be worth up to USD 350 million a year based on a magnetite price of USD 150 a tonne.
CITIC Pacific Sino Iron project in the Pilbara will be WA first mine to produce magnetite concentrate when it begins exporting this year. Two other China led magnetite ventures, Gindalbie Metals' Karara in the Mid West and Grange Southdown near Albany are tipped to come on stream next year and 2014 respectively.
Mr Moore was unavailable for comment. It is understood the Government is resisting industry calls for concessions because it wants a better deal for taxpayers than achieved under historical royalty breaks for BHP and Rio. The Government is also believed to be nervous that Canberra may scoop up the money through company tax while the Commonwealth Grants Commission could penalise WA for not taxing enough.
The Association of Mining and Exploration Companies said it hoped the Government would reconsider its position. (sourced from Thewest.com.au)
It is reported that Magnetite iron ore miners will be forced to pay the full royalty rate as the WA Government moves to avoid a repeat of the costly concessions enjoyed by mining giants BHP Billiton and Rio Tinto for decades.
With Mines and Petroleum Minister Mr Norman Moore expected to make a decision within months on the rate magnetite miners will pay for the ore they export, it is understood the Government is set to impose the full 5% impost. The decision would come despite efforts by the fledging magnetite sector to win concessional rates of between zero and 3.5% for the first few years of production and collect hundreds of millions of dollars a year in extra revenue.
Although the Government has remained vague on the amount of money the tax would generate forecast production from WA's three leading magnetite players suggests a rate of 5% would be worth up to USD 350 million a year based on a magnetite price of USD 150 a tonne.
CITIC Pacific Sino Iron project in the Pilbara will be WA first mine to produce magnetite concentrate when it begins exporting this year. Two other China led magnetite ventures, Gindalbie Metals' Karara in the Mid West and Grange Southdown near Albany are tipped to come on stream next year and 2014 respectively.
Mr Moore was unavailable for comment. It is understood the Government is resisting industry calls for concessions because it wants a better deal for taxpayers than achieved under historical royalty breaks for BHP and Rio. The Government is also believed to be nervous that Canberra may scoop up the money through company tax while the Commonwealth Grants Commission could penalise WA for not taxing enough.
The Association of Mining and Exploration Companies said it hoped the Government would reconsider its position. (sourced from Thewest.com.au)
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