Australian miners 'hopeful' on tax talks with new PM
- 24 June 2010
- From the section Business
Mining companies in Australia have expressed hope of reopening discussions about a controversial mining tax with the country's new prime minister.
Julia Gillard, who has been sworn in as Australia's first female premier, said she was "throwing open the government's door to the mining industry".
Her predecessor, Kevin Rudd, had slumped in the polls after proposing a 40% tax on mining profits from 2012.
Mining giant BHP Billiton said it was "encouraged" by Ms Gillard's comments.
"The industry has consistently been calling for the government to take the time to properly engage on all aspects of the tax, and we welcome the opportunity to do so," BHP said.
"We look forward to working with the government in this new way to find a solution that is in the national interest."
Mining shares in Australia closed higher, with BHP rising 1.3% and Rio Tinto up 1.7%.
However, miners were the biggest fallers in London trading, after the US Federal Reserve said the US economic recovery was faltering, sparking fears over demand.
In May, as part of a wider review of the government's tax policy, Mr Rudd announced plans for the Resource Super Profits Tax to come into force in July 2012.
He said the tax would raise around AUS$9bn (US$8.3bn; £5.5bn) annually, allowing the Australian people a greater share in mining profits.
But it was met with hostility by the industry, who said that it would push investment in mining abroad.
Xstrata said it was shelving investment in two mines in Queensland because of the tax, while Fortescue Metals threatened to abandon two projects in the Pilbara region of western Australia unless plans for the tax were reviewed.
Both the government and the industry ran advertising campaigns putting forward their views on the tax.
But both sets of adverts have now been pulled in the wake of Ms Gillard's election.
"Today I am throwing open the government's door to the mining industry, and I ask that in return the mining industry throws open its mind," Ms Gillard said.
"Today I will ensure that the mining advertisements paid for by the government are cancelled, and in return for this I ask the mining industry to cease their advertising campaign as a show of good faith and mutual respect."
Mitch Hooke, head of the Minerals Council of Australia, responded: "The board is determined to suspend advertising as a gesture of goodwill in the expectation that the consultations will be meaningful and constructive."