Earth AI, Legacy Minerals make first greenfield palladium discovery using artificial intelligence
The companies announced the verified discovery of one of the largest palladium mineral systems in Australia.
In 2012 the Australian state designed a tax that would allow it to benefit from major mining profits. This is the first year the government collects this highly controversial levy and lately Australian media have been scrutinizing the results.
Guess how much Rio Tinto (NYSE:RIO) paid so far this year under the new tax regime.
Nothing. In fact, the “nation’s biggest and most profitable iron ore miner” received a $74 million refund on its April quarterly pre-payment. In the June quarter, after “review work by Rio and tax office” the miner found that it didn’t owe anything.
The final bill however will not be evaluated until the end of the financial year.
The tax in question is the Minerals Resources Rent Tax (MRRT) – also known as the “super profits tax” – which was introduced by the country’s Labour party last year. The MRRT only comes into effect when miners profits hit or exceed A$75 million – these “super profits” are then taxed at a rate of 22.5%.
“We’ve seen that iron ore prices have reduced and that as a consequence of that, we’re not seeing great triggering of the mining tax,” Sam Walsh, Rio’s CEO, told The Australian.
Initially promoted as a major feat in the government’s ability to raise revenue, opponents on all sides are criticizing the policy for being “unfair,” “discriminatory,” “flawed” … the list goes on.
“It is flawed, it’s not raising any money,” the leader of the Greens Party told Australia’s Business Report. “Rio Tinto didn’t pay any in the June quarter, how ridiculous is that.”
The refund and general lack of revenue generation from MRRT could have a dampening affect on the Labour party’s budget, The Sydney Morning Herald writes. Last year the government estimated the tax would bring in A$3 billion in its first year. That figure was revised to $700 million, then again to $200 million. But with Rio’s refund even this number is questionable.
Rio – alongside BHP and Xstrata – was involved in watering down the MRRT with former Prime Minister Julia Gillard. With elections coming in September its possible that the bill may be repealed, although an Australian court recently dismissed a legal challenge by Fortescue Metals (ASX: FMG).
