May

21

BHP, Woodside attack ta.

May 21, 2010 | Leave a Comment

The Federal Government’s proposed super tax would slow investment and risks jobs and was a threat to Australia’s international reputation, resources giants BHP and Woodside have warned.

BHP Billiton has told a Federal Government consultation panel that the proposed resources super tax does not meet sound principles of taxation.

“As previously conveyed to the Government, BHP Billiton believes any new tax on the minerals resources industry needs to be prospective, not retrospective; ensure the overall tax burden is competitive with other mineral rich countries; vary by commodity and be levied on the value of minerals alone,” the company said in a statement.

Woodside chief executive Don Voelte said that although the company was hardly affected by the proposed new resources tax, it still posed “huge implications” for Woodside.

Mr Voelte said the proposed tax has been viewed negatively in international markets.

“We have to be seen as a sovereign, risk-free country, in other words a very stable country,” Mr Voelte said at a business lunch in Sydney.

He said Woodside had to borrow from offshore markets including places such as New York, Japan, Asia and China and that constant tinkering with the tax system had not been received well offshore.

“The thing that bothers me probably the most on this is, this is the third time in three years that we have had a major change to tax,” Mr Voelte said.

“And, if this Government starts to be seen as willy-nilly changing tax any time they want to on this thing, it is going to be viewed very negatively. We have to be a very solid place for these people to invest in. They have to have security of their investment in Australia.”

BHP said it had told the panel the proposed tax did not recognise how investment decisions were made in the resources industry and would place Australia in an uncompetitive position globally.

The company told the panel the government should take time to properly engage with the mining industry on all aspects of the tax rather than pursue selective adjustments.

This morning, BHP representatives met with the government’s panel set up to consult with miners over its proposed resources super profits tax which would place a 40 per cent tax on the profits of Australia’s big miners.

The Federal Government established the tax consultation panel to explain to resources companies the features of its proposed 40 per cent resources super profits tax.

The panel includes Treasury and Australian Taxation Office officials, as well as a representative from the Business Council of Australia and an independent adviser.

Since the government announced the new tax proposal earlier this month in its response to the Henry tax review, a host of resources companies have complained about the proposed arrangements.


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