MEDIA RELEASE

MINERALS COUNCIL OF AUSTRALIA

MINERALS COUNCIL OF AUSTRALIA REPEAL OF THE MINERALS RESOURCE RENT TAX

Statement from Mitch Hooke, Chief Executive Officer, Minerals Council of Australia

Todays release of exposure draft legislation is the first step in the Government meeting its long standing commitment to repeal the Minerals Resource Rent Tax (MRRT) - a new tax which imposed an unnecessary impost on Australias mining industry. Over the last decade, Australias minerals resources industry has gone from contributing around $4 billion a year in company tax and royalties to almost $20 billion per year. It has paid almost $117 billion in company tax and royalties since 2006-07 and faces a high and stable effective tax rate in excess of 40 per cent. The MCA has consistently argued against misleading information that the industry does not pay a fair share. Indeed, the MRRT was not necessary for all Australians to share in the benefits of the Millennium mining boom as research by the Reserve Bank of Australia, Treasury and the Bureau of Resources and Energy Economics has consistently shown. Coal and iron ore mining are the nations two largest export earners. They have played a key role in supporting Australias current prosperity, boosting incomes and jobs and helping to cushion Australias economy from recession during the Global Financial Crisis. They were among the highest taxed industries in Australia before the introduction of the MRRT. Even with repeal of the MRRT, Australia will remain a relatively high tax jurisdiction for coal and iron ore mining. While the MRRT is not as punitive as the flawed proposed Resource Super Profits Tax, it nevertheless compromised Australias attractiveness as an investment destination and put Australia at the Mount Everest of international tax rates. The contentious debate surrounding the tax and its continued existence has undermined Australias sovereign risk standing as an attractive place to invest in a highly competitive global market for resources development. Repeal of the MRRT will restore industry confidence and remove a further impost that destroys value in long-term, risky coal and iron ore projects. Release of the draft legislation by the Government sends a strong signal of Australias determination to remain a premier destination for mining investment.

Media Contact: Assistant Director Corporate Affairs Brenda Conroy T: 02 6233 0651 M: 0447 452 675 E: brenda.conroy@minerals.org.au

W: www.minerals.org.au

D: 24 October 2013