Backyard Aquaponics
A place to discuss aquaponics

yeah I stayed up & watched that 4 corners aswell

pity the mining companies have deep pockets for advertising their rubbish and their flunkies get to cry foul when the government tries to argue back in the same arena

poor twiggy and gina only got 1000 sheep to help them cry in public today

Very simple, if shelved, those riches will not go bad as a basket of eggs.
Our kids may get much better return for them.

Not as much as them if they invest those profits in Canada.

Which is exactly why no one should be concerned about this tax. It wont cost jobs, there are plenty of jobs out there. State governments letting projects go ahead without stipulating that 90% of the work must be performed in Australia is what is costing jobs. There is no need for engineering work to be sent overseas.

Well if you follow the same train of thought... (ie.. 90% of work being sent outside Australia)... if the mining companies were forced to be taxed, they will certainly find ways to reduce their profits or make more profits to cover the tax... as such, wouldn't the companies be looking at sending more work outside Australia since labour cost in Australia is actually considered high compared to where the work is getting done???

there's only a certain amount of work that can be sent offshore - digging stuff out of the ground HERE can not be sent offshore

all the qwork that goes to supporting those digging junk out of the ground HERE cant be saent offshore

you cant SEND the item to be mined somewhere else, the more jobs sent ofshore , the more the remaining guy doing the work at the coalface gets paid

money money money, this is the ONLY thing the whole argument is about. the rest of the world could turn to zombies or completely shut us off and Australia could be completely self sufficient and tick along quite nicely, as long as enough of us get the word out there and teach the sheep how to grow their own veggies and fish in their OWN DAMN HOME

imagine how wonderful the world would be if everyone grew enough food in their own space to go a long way to sustaining themselves, trading only what they needed.
It would assume stoppage of every council fee, law government decree , land tax

oh , Ive gone off topic and now Im ranting

hehe "qwork"

Nice fantasy

whats wrong with this Stupid Tax
1) its retroactive, this tax applies to pre-existing projects, the mines paid real money for the leases, and now the government is changing the rules big-time. This is called Sovereign Risk and is why miners stay away from places with dictators. (Its like leasing a car, and then the lease rates double because the car company felt like it.)
2) it taxes infrastructure not just minerals. yep, the railways and ports that are owned by the mines get this tax too, the ones not owned by the mines don't. this is discriminatory in nature and strongly discourages infrastructure spending by the miners, so now we have to rely on our wonderful comrades in government to provide for us...
3) it taxes downstream processing of minerals in Australia. - yep, it discourages value-adding (steel making at whyalla or upgrading bauxite to alumina to aluminum). As it stands expect it to kill the south australian steel industry. (you'll notice that companies that value add overseas- won't be liable for this tax ie Galaxy resources.)
4) It treats all minerals as the same, so the high risk minerals like nickel and molybdenum just won't be developed. (there is a reason for royalties to be different rates)
5) It is before the cost of interest and capital. - this is pure BS on the government side. Twiggy Forrest had to go USA because a borrow $100m with an interest bill of about $4 BILLION because he couldn't even get that from Australian or Chinese financiers to get started 10 years ago. All taxes normally be after interest/funding expense. This part is utter insanity.
6)It is a tax on renewable energy. the geothermal energy is renewable similar to solar energy (one come from the earth's physics, one from the sun's) it may take an unknown period of time to heat the resource back up, but it will heat back up, will the government then refund its Super Tax with interest??? aren't we suppose support zero emission energy?
7) It is a tax on jobs, I work for a company that works for another company which is working for miner building a port some 500kms from the mines. This tax is really bad for my job security. The Australian listed/originated miners actually feed more work to Australian fabricators than a purely rational company would do, now that will go also.
8 It encourages overseas mines development to the long term detriment of Australian exports - stupid, stupid, stupid and stupid
9) It sells out Australia to overseas investors, where as a mine before this tax might getting funding from overseas for about 30% equity, now it will require to give 60% (or so) to the overseas funder.
10) It demands payback starting immediately, not just after the capital is recovered.

If they were merely proposing a 40% tax on profits for new developments (so not sovereign risk) based on mine output (excluding downstream/out of lease value adding), with varying rates of bond rate (to acknowledge the funding difficulties of differing risks for differing commodities), allowed the companies to recover their capital (cash flow risk) and excluded renewable resources (geothermal) then this would probably have been a reasonable idea. as it is, its being executed in a Stupid fashion to the detriment of our children future.

*frack* off idiot.

1) paid real money to the state government that is then refunded in full, after being claimed as a tax break, by the federal government
2)infrastructure that is already immediately 100% written off as a tax break. no other company that builds this shit can get those tax breaks in that sort of timeframe.
3)bullshit
4)then don't mine them.
5) and those estimated 4bill are all written off as expenses. see (2)
6) you CENSORED dont deal in renewable energy. *frack* off
7)bullshit
bullshit
9) bullshit
10) about time, see (2).

we've all seen the real numbers. 13% effective tax rate. laying off more workers than any other sector whilst claiming to be saving the economy. paying huge sums to the boss for doing *frack* all. absolutely raping the environment with no regard as to how you might make it good again after your finished. about time you all started paying your fair share.

i spose you think daylight savings is a bad idea too. get a real brain, not one paid and tax-offset by the big miners. surely the fact that your paying between 35 and 46% tax to work for a company that pays 13 should ring some alarm bells.

Orcy2010, not sure if you work actually work in the resource sector (oil & gas or mining), but I would take a guess that you don't... The issue with job security is real...

Job security is a big issue for employess of those companies that rely on the operating companies to decide to move on the greenfield and brownfield expansion projects. This could have a big "domino" effect since these companies may sub-contract some of their work to other smaller companies and so on and so on... so stopping or holding back a project at the operating companies will definitely have an impact...

There are also issues with decisions in mining affecting the oil & gas jobs... I was meant to work on an onshore gas expansion project that pre-dominately supplies gas to mining companies for power generation... when the tax was announced, the operating company that was pushing this project had to reconsider their options and informed my company that the project which was meant to start shortly was put on hold until further notice... Guess what... I was made redundant...

People working for operating companies aren't that badly affected because they will generally have a couple of years of work to catch up on anyways... but nevertheless, they would also notice that the capital expenditure is very much reduced...

well i have relied on mining for the past 16 years and thats most of my working life so if there is no mining i will be out of a job and lots of Australians will to, so i guess i wont be alone!

orcy with a reply like that who looks like the idiot?

No, it's not "retroactive"... or even "retrospective".... it applies to profits beyond a certain level... AFTER WRITE OFFS etc... regardless of whether or not it's an existing project or one they may come online in the future...

Same as the introduction of the GST... baloney...



No it's not... "sovereign risk" is a term that relates to the risk of a country defaulting on it's loans...

A mining company... or a tax... has nothing to do with sovereign risk... baloney... and completely untrue...

And throughout history... mining companies and dictatorships have frequently been more than casual bedfellows..




Pure bullocks... how does it tax "infrastructure"...

As to the "comrades" line... perhaps we should start referring to the owners of the mining companies as "fascists"...

And there's a long history of correlation between this industry and that politics... see above..



No it doesn't... the entire purpose is to tax a "non-renewable" "one time process"... that's the whole point... the mining industry doesn't value add... and return to the Australian people...

Indeed.... a lot of our resources are "owned" by overseas companies/ventures... baloney..



No it doesn't.... it's a tax on "super-profits"... not on minerals.. or any "class" of minerals.. baloney..




No it's not... company profits are determined AFTER all interest, capital and other writeoffs are applied... and the creative accountants weild their "magic"...

It's a tax.. on declared profit.. baloney



WTF??.... if anything... the monies from the tax might be invested in renewable energies... or indeed the mining industry might actually "value add"... and commit to renewable tecnology research... and receive the rebates under the proposed tax... baloney..



No it's not... in fact the investment in infrastructure by the government will probably result in job creation... whereas the mining companies are likely to, and almost always do... react to price fluctuations.. by sackings and closures... baloney..



Bullocks... any overseas projects will be determined by the profitability of operations within any respective countries, infrastructue, environmental laws, availability of finance and metal prices...

Most ventures are funded and under-written by anglo-europen banks and insurance companies (and lately China)...

And the current "reviews".. are more a reflection of concerns about anglo-europen instabilty... than anything else..



Rubbish... funding is determined by profitability... this is an arguement about "super-profits"... where the base prices have risen over 900%.... above and beyond what was determined as sufficient for investment in the first place...



Yep, it's a tax on "super-profits".. a sliding scale... that becomes effective above a certain level... as soon as the law is passed... and even under-writes "losses"...

Are you suggesting that the government should wait until the end of life of the project... on when the price falls... before applying a tax....



Companies.. or projects... don't have "sovereign risk"... countries may... and this tax dose NOT pose a "sovereign risk"...

Nor do companies mining a natural resource and shipping un-processed ore overseas... value add... that's the whole point...

And there is argument that tax concessions should be given to industries that value add...

As to our "childrens future"... well just where/what is that future... after the mining companies have dug up all the resources... and departed overseas.. to rape and pillage another countries resources...

Do you really think that they're going to send monay back home to "our kids"...

Bullocks... please research this issue beyond the Mining Councils website..

It's the same bullocks that been trotted out... almost word for word... for decades.. not just here in Australia... but overseas as well...

Rupert thanks for a much more effective and useful reply than orcy2010

I still think this is poor policy. They have mixed up too many principles, as you point out it is a super profits tax

However why are they designing a super profits tax and applying only to one industry. If it's claimed that it is because the resources are owned by the population that appears to be wrong. The resources are owned by the Crown and it is the responsibility of the states to be paid for them. The minerals are an input cost to the mining industry and should not be lumped in with federal income tax.

The process of taking joint partnership is is similar to a forced acquisition. Many of these projects will have been supported at a loss by the shareholders for years now as they become profitable the government takes a 40% grab. Since these projects, the risk they take and the losses they sustained are to be taxed into the future it does effect the total return on investment and in that sense are retrospective. They may not have gone ahead if this tax had been accounted for.

If miners aren't paying their share of tax (which is not reflected by the analysis) then it's a collection issue. If they think there should be a Super Profits Tax it should apply to all profitable industries i.e. banking and others.

Afraid not Rupert
from "The Association of Corporate Council - Alan Jessup"


Also the the 40% guarantee is is worth less than appears as it is only ever paid out in the future, when inflation will have reduced its value.


Sovereign risk is perhaps not the best term though I believe most people would get the gist and be less pedantic than you. A better term would be geopolitical risk;
Investopedia

the CPA calls this tax retroactive
http://www.cpaaustralia.com.au/cps/rde/ ... tation.pdf
page 13
but this is because it is similar to a retroactive capital gains tax, because its not a retroactive income tax, and most people just think of tax as income tax.

Sovereign risk also has different meanings to different people, but to mining it is very well understood to mean when royalties change drastically/or projects get unilaterally partially/completely confiscated by the government. for example Venezuela. Sovereign risk does NOT include the usual varying the rates of income tax up and down.

the ambit of this tax is vague, currently it seems to stop when the commodity is sold or dealt with at 'market value'. The situation's like Whyalla's mine and steel mill, the tax does currently seem to apply to the steel mill also (although i doubt that was the original intent). The tax seems targeted at infrastructure owned by mines and until the government says the railway and ports built/owned and operated by miner's are not subject to this tax, then its reasonable to assume that they are. (for example it seems that BHP's integrated rail is subject to this tax, but FMG's rail may not because its a more arm's length business)
Similarly internally used mineral resources (ie integrated mine/power or mine/refinery) seem penalized by this tax. look up submissions from electricity industry groups. guess which way this will send electricity prices, not that i mind, i've got solar PV and Hot water, but this will hurt lots of people who are stretched already.

on point 10, i would've expected this tax to apply after the company has recovered its capital expenditure, similar to the current oil and gas tax. This is after all marketed as a tax on super profits (not just income profit), and to me personally a SUPER profit starts after the capital has been recovered.

and yes it is really surprising that the cost of financing is excluded as a deduction for this tax, to me that indicates a level of aggressiveness that is really quite startling (divisive), i was just expecting something like raising the income tax on mine output to 40%, not a additional, complicated 40% tax on top everything else.

Until the government says that geothermal companies are not subject to this tax, (and the companies themselves certainly hope that they can escape this tax), then at face value it is a tax on at least one particular form of zero-emission renewable energy.

this is bad for value adding in australia
http://www.galaxyresources.com.au/docum ... 100507.pdf
this company is effectively boasting that because they are value adding in China, they will basically avoid Australia's RSPT tax.


looking back, if we had this tax a couple of decades ago, mineral output would've have gone from 1/3 of Australia's exports to 1/4 of Australia's export, (instead it went from 1/3 of Australia's exports to 1/2 of Australia's exports)
Australia would have had 25% less foreign currency to buy medicine, cars, computer games, plastic for aquaponics etc etc etc
as a nation we would had to use 25% less (by value) medicine or computers and the GFC would've hit us a lot harder, because as a mineral exporter to China, at least that market kept buying during the crisis.

Alex, I think you don't understand that the essence of the GFC was leverage. The bigger the bubble, the bigger the pop! Australia would have been better off if mineral output went to "1/4 of Australia's export, (instead it went from 1/3 of Australia's exports to 1/2 of Australia's exports)".

Now 50% of your exports are at risk once China pulls back (as it must).

The GFC is about to enter round 3 but Australia is barely into round 1 (your housing bubble hasn't popped yet). The housing bubble will probably pop when commodity prices start crashing. I know some have come down a bit (copper). As de leveraging and deflation accelerate worldwide mining will get crushed, but not because of this tax. It is a mathematical certainty.