A Win for Mining Companies
Today the PM Julia Gillard announced a deal with mining companies. The changes as follows have been welcomed not only by industry but investors:-
Super Profit Tax, now renamed the Mineral Resource Rent Tax, has been reduced from 40% to 30% kicking in when profit exceeds the long term bond rate plus 7%, ie at around 12%
The tax will only apply to Iron Ore and Coal and will exclude smaller mining companies.
But what the government giveth, the government also taketh away.
A Loss for Small Business
As this comprise means a reduction of approximately $1.5billion in revenue for the government over the next four years, the government have also announced the company rate will continue to be cut to 29% from 2013/14 but will not be further reduced.
This is somewhat tough for small businesses as lifting of superannuation will remain.
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