Fact checking a Greens mining-tax claim

I’ve just watched NSW Greens MP Cate Faehrmann making the claim that Australian miners pay the lowest corporate income tax amongst Australian industry. But that simply false. Last year I calculated the average tax rates for Australian industries using ATO data.

Mining taxation

In order to gain some appreciation for how the average effective tax rate for mining has varied over time I calculated the average effective tax rates for all industries and the corporate sector as a whole. The data are calculated from various issues of ATO taxation statistics for each industry, and each year from 2000-01.

I then calculated the standard deviation of average effective tax rates across the industries. The average effective tax rate for All Industries is graphed and plus and minus one standard deviation from the average is graphed too. Results are shown in Figure 3. Also included is the average effective tax rate for the mining industry. As can be seen, the mining industry has a higher average effective tax rate than the Australian average. Indeed, it has always been above the average plus one standard deviation of All industries.

This entry was posted in Mining Tax. Bookmark the permalink.

32 Responses to Fact checking a Greens mining-tax claim

  1. Fisky

    It is long past due that the Racial Discrimination Act were extended to cover false claims about an entire industry sector. This spokesperson should be arrested, fined, and jailed for breaking racial incitement laws.

  2. Gab

    I don’t understand why the Greens keep repeating the lie. oh wait, yes I do, The media. The so-called “journalists” never bother to call them – or the ALP – out on this lie.

  3. jupes

    It never ceases to amaze me that the media interviews Greens as if they are going to say something sensible.

    And it also never ceases to infuriate me that the sycophantic media never hold them to account for the stupidity and ignorance that vomits from their mouths.

    Cate Faehrmann was also allowed to fudge and avoid commenting on the issue of gendercide. Disgraceful.

    Disclaimer – I only watch shows like The Drum occasionally in the hope that the token conservative will kick ass and take names. I must be an optimist.

  4. .

    I truly don’t know how they get away with their lies, fabrications and human hating idiocy.

  5. Louis Hissink

    What are the numbers that the Greens are basing their allegations on?

  6. Papachango

    Louis beat me to it. The Greens must be basing their claims on some half truth, then widely distorting it to suit their agenda. So what is it?

    Like the old line pushed b Catherine Deveny and others about the private schools getting ‘three times as much government funding per student’ as public schools. This only takes commonwealth funding into account which is a quarter of total funding, so in other words is complete bollocks based on a half truth.

  7. jupes

    What are the numbers that the Greens are basing their allegations on?

    That don’t have to base it anything. They know they won’t get called on it.

  8. Louis Hissink

    From the Green’s web site

    29th April 2013 3:05 pm
    Economists Ross Garnaut and John Quiggin have agreed with the Greens that the mining tax has significant flaws during a Senate Inquiry hearing into the mining tax in Melbourne today, the Australian Greens said.

    “Professor Garnaut referred to the Gillard Government’s generous depreciation provisions for Australia’s most established and profitable mines which allows these mining companies to pay very little tax,” Australian Greens Leader Senator Christine Milne said today.

    “Professors Garnaut and Quiggin gave evidence that increasing the rate to 40 per cent and extending the tax to all minerals were logical improvements.

    “Fixing these three flaws will raise an additional $26 billion over the forward estimates.

    “With the $12 billion revenue hole revealed by the Prime Minister today, now is the time to fix the mining tax, not rely on further cuts to education or vulnerable people like single mothers.”

    Source

  9. Louis Hissink

    So off to the senate inquiry we go aha, aha,aha……..Sigh

  10. Louis Hissink

    Actually the reason the MRRT is the dog’s breakfast it is, is because it is fundamentally unconstitutional. The doggy-vomit is due to the ways and means of circumventing the constitution, so I am informed. Apart from the crass ignorance of what the mining industry actually does to earn its crusts.

  11. FDB

    Perhaps the Greens are basing their claim on the thing that they are explicitly talking about – corporate income tax, not “effective tax rates”, which Sinclair has failed to define.

  12. Sinclair Davidson

    FDB – I calculated the effective rate of corporate income tax. Follow the link.

  13. JC

    Perhaps the Greens are basing their claim on the thing that they are explicitly talking about – corporate income tax, not “effective tax rates”, which Sinclair has failed to define.

    .

    Investopedia Definition.

    The average rate at which an individual or corporation is taxed

    You goose, it’s a well known economic concept. Under the Fisk Doctrine, you would be jailed for a month and get a life time ban from the internet for saying stupid shit like that.

  14. Sinclair Davidson

    I suspect the Greens are basing their views of mining corporate income tax from some of the silly arguments made during the 2010 RSPT debate.

  15. Louis Hissink

    FDR, go buy a share in BHP-Billiton, pay for it, and wait for the dividend – you will find its about 3% on average pa. That’s what the super funds and other investors get when they invest in the blue chip miners.

    Increasing the MRRT will reduce the amount of dividends payable to the shareholders and investors.

    It’s the ALP’s way of taxing YOU, by creating the mining company straw man and taxing that instead of increasing your personal tax.

  16. FDB

    I’m not saying it, I’m suggesting that’s what the Greens lass was saying.

  17. JC

    I’m not saying it, I’m suggesting that’s what the Greens lass was saying.

    FDB

    We don’t need you to interpret what that human debris (the Greenslime) has to say, as we don’t care.

  18. Mk50 of Brisbane, Henchman to the VRWC

    Greenfilth, JC, greenfilth.

  19. FDB

    Increasing the MRRT will reduce the amount of dividends payable to the shareholders and investors.

    It’s the ALP’s way of taxing YOU, by creating the mining company straw man and taxing that instead of increasing your personal tax.

    What a risible contribution. Of course taxing mining companies more affects the returns for their shareholders – that’s the whole fucking point.

    Meanwhile, it gives the government more money to spend on everyone else (or in practice, on giving most of it back to those very same shareholders in one form or another to get re-elected, but I digress).

  20. FDB

    JC – if you don’t care what the Greens have to say, why do you spend so much hot air on it?

  21. JC

    Because it’s fun to unveil their deceit/ stupidity and see them pulverized.

    I don’t just want to see them destroyed FDR. They deserve to be thrown into the trash as they’re human garbage.

    I take it you’re one of their erstwhile supporters, right?

  22. JC

    What a risible contribution. Of course taxing mining companies more affects the returns for their shareholders – that’s the whole fucking point.

    No it isn’t, you goose.

  23. JC

    You’re confusing objectives with impact and the two aren’t the same.

    Stop talking about this stuff as it’s not you’re strong suit, FDB.

  24. Gab

    Of course taxing mining companies more affects the returns for their shareholders – that’s the whole fucking point.

    Meanwhile, it gives the government more money to spend on everyone else (or in practice, on giving most of it back to those very same shareholders in one form or another to get re-elected, but I digress).

    and unicorns are gamboling in the fields.

  25. Louis Hissink

    FDR,

    How about taking the money off the shareholders then, instead of the corporate vehicle that produces the profits for the owners?

    That’s the whole point, isn’t it. Instead of taxing the mums and dads, which is politically counterproductive, you tax it earlier upstream by hitting the companies.

    Let’s hope you have none of your super funds invested in blue chip mining stocks.

  26. Except as I pointed out in an unpublished letter to the AFR in response to your article there on effective tax rates and mining companies, accounting income is a better base for determining effective tax rates. Using taxable income is a sleight of hand.

  27. Tel

    It’s the ALP’s way of taxing YOU, by creating the mining company straw man and taxing that instead of increasing your personal tax.

    … and you won’t even know how much you have been taxed until you try to retire and the bandits are long gone.

  28. .

    You want to back that claim up Passant or argue from authority using an “unpublished letter to a newspaper of record”?

  29. thefrollickingmole

    People, people, raising tax money is the SECONDARY objective of the greens mining tax.

    The real objective is to make it too costly to open new mines/expand old ones.

    Look at it through that prism and youll see why the truth and facts come a long way second.
    Theyve got the mining industry in the wicker man, unfortunately they didnt put enough kero on it to light last time and are back with a new packet of matches.

  30. Louis Hissink

    Frolicking,

    Three of my former mates in the diamond business (De Beers has closed up shop in exploration many years ago) are looking for rare earth’s (REE) not in Australia but Africa. Why? The burden of compliance paperwork is too enormous here.

    I can concur with this and it’s presently red, brown, green, black and fluro tapes which need to be surmounted. Minimum of 5 years of approvals to get to the mining stage. In terms of capital to just survive the approvals process you need about $1.5 million per annum funding.

    Even more crucially, if a new mineral deposit is found, it takes about that long to determine if or not it is economic, having to comply with JORC standards.

    And now the term “social license” has been coined, and we have to pass that test as well. No bank is willing to lend money under those conditions, and equity financing?

    There are exceptions such as Sirius which discovered a monster deposit and funding was easily achieved but it too has the 5 year hurdle to mount.

    Most of the exploration dollars are off to Africa, since Australia has now attained sovereign risk status.

    But are the Greens aiming at destroying the mining industry? Yes but that has to be seen through the lens of also wanting to destroy civilisation, because without mining there is no civilisation. After all, how on earth did the ancient Egyptians quarry all the stones, or the pre-Columbian aboriginals construct there stone structures?

    The Green future is North Korea but without the infrastructure.

    And it’s FDB, slip of typo though your views with FDR would seem similar.

  31. Craig Mc

    The first and most pertinent clue that the claim is false is that it’s coming from a Greens MP.

  32. steve

    it is a known fact the greens don’t like any industry that affects the environment. they would prefer that the mining industry wasn’t there. even though they have benefited from it. why don’t they target the banks super profits. the mining industry pays its fair share and if the tax hasn’t produced a lot of revenue that’s because the resources sector is slowing and there are no super profits. the govt and greens are looking for anything to attack and get some money out of because they have mismanaged the economy with over spending and under estimating the state of things. they were to busy trying to buy votes and convince us that everything was great under them to see the real picture and now we are billions in debt and growing.

Comments are closed.