Resources super tax

"A man and his wife had the good fortune to possess a goose which laid a golden egg every day. Lucky though they were, they soon began to think they were not getting rich fast enough, and, imagining the bird must be made of gold inside, they decided to kill it. Then, they thought, they could obtain the whole store of precious metal at once; however, upon cutting the goose open, they found its innards to be like that of any other goose"

The new tax reform proposed by the Rudd government cannot be good for any involved in the mining industry. Increased taxes on mining companies will lead to a review of mining projects and business strategies; whilst I believe that most will go ahead, undoubtedly some won't.

Now I'm no accountant (far from it) and don't have the hard figures but it seems like this is going to have long term impacts on both the local and global economy. When governments make changes like this it puts off companies, mining and other, and they'll reconsider investing in Australiabecause the goal posts can change frequently depending on the government.

Here is a link that shows how it may effect the Oil & Gas sector as well.

For the other side of the argument see here.

It will be interesting to see how this plays out. Do you think some of the majors will go a bit cold on Australia and if so what negative and positive effects do you believe this will have? Will the Rudd government be guilty of killing their Golden Goose?

Forrest Briggs
Principal Consultant - Mining