Foreign investors have raised concerns over uncertainty surrounding Australia’s mining and carbon tax regimes, with mining companies attacking a government plan to obtain an additional AUD$1.9 billion in taxes via stronger regulation of cross-border profit-shifting.
The Australian government plans to introduce retrospective changes to ‘transfer pricing’ laws that affect trade between the different parts of multinational companies, which will be applicable to tax disputes going back to 2004.
Rio Tinto tax expert Richard Atkinson is cited by Fairfax Media as saying that changes create ‘significant risk’ of double taxation in different jurisdictions, while BHP’s tax manager Don Spirason expressed his opposition to the taxes for creating greater uncertainty.
Concerns have also been raised over uncertainty surrounding Australia’s carbon tax and climate change policy, with AGL Energy chief executive Michael Fraser quoted in the Australian as saying that Australia ‘risks losing its reputation as a stable investment destination’ due to the ongoing political furor over the Renewable Energy Target.
Fraser made the statement at the Clean Energy Week conference in Sydney, where he endorsed the Labor government’s decision to remain committed to a 20% RET and opposed calls from the Green party for its increase.
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