Iron ore price hits five-week low as traders fret about Chinese demand
Iron ore has slumped 29% this year, hurt by the prolonged slowdown of China’s economy.
The Australian government’s windfall tax on coal and iron ore miners’ so-called “superprofits” has raised a paltry $130 million over the first six months.
The money raised to 31 December 2012 under the minerals resource rent tax (MRRT) compares to a target of $39 billion set by the government through 2020 and $1 billion for the current financial year.
Australia’s tax office reportedly spent $50 million preparing and instituting the tax which affects a few dozen companies including BHP Billiton, Xstrata and Rio Tinto operating in the country.
Australian miners with profits or more than $75 million a year are taxed at 30% which translates into an effective rate of 22.5% after deductions and rebates.
Miners also have to contend with a tax of $24.50/tonne on carbon emissions that kicked in at the same time as the MRRT.
Australian football image by Neale Cousland / Shutterstock.com
