Australia Government Planning A$4 Bln Resource Tax Fix - Report

22nd Jun 2010 22:27

SYDNEY (Dow Jones)--The Australian government is planning to use about A$4 billion in savings from axed rebates to refashion its contentious resource super profits tax, say government sources according to a report in Wednesday's Australian Financial Review. The report says the government will ditch a proposed exploration rebate and 40% upfront capital allowance for losses and use the savings from this to raise the rate of return at which the tax will kick in. The revised proposal will also see lower-value resources such as clay, sand, gravel, rock and limestone dropped from the tax, while the taxing point for other commodities will be brought forward to nearer the point at which they are extracted from the ground. The report says this will leave coal and iron ore as the major revenue raisers from the revised tax, and its biggest impact will be on mining giants BHP Billiton Ltd. (BHP, Rio Tinto Ltd. (RIO.AU) and Xstrata PLC (XTA.LN). However, the government sources insist there will be no change to the proposed resource tax's 40% rate, the report says. Newspaper website: http://www.afr.com -By Sydney bureau; 61-2-8272-4680; [email protected] (END) Dow Jones Newswires June 22, 2010 17:27 ET (21:27 GMT)