Three of the world's largest mining companies launched a united attack on the Australian government yesterday over its refusal to back down over plans to introduce a 40 per cent tax on the sector's profits.
BHP Billiton, Rio Tinto and Xstrata, all listed on the blue-chip FTSE 100, issued an unprecedented joint statement after meeting government officials in Canberra, saying that Prime Minister Kevin Rudd's administration had not addressed miners' concerns.
The government announced plans to introduce the so-called Henry tax last month. It will target the profits of resources companies operating in the mineral-rich country. The mining companies have responded by threatening to withdraw investment from Australia, while the row is now threatening to derail Mr Rudd's general election campaign ahead of October's poll.
Yesterday's statement said that the three companies had received, "no formal acknowledgement from government that [the] key issues will be addressed."
They are seeking assurances from the Canberra administration that the charge will not be applied retrospectively, as has been suggested. They also say that Australia needs "an effective tax rate that retains [her] international competitiveness as an investment destination" and stable "arrangements for taxes and royalties for existing and new projects".
Despite the statement, Mr Rudd told reporters that he would consider treating sectors of the mining industry differently. "It is quite plain that we will be considering with different parts of the industry their respective requests for transitional arrangements which may be particular to their industries," he said. "Whether we respond positively to that is a separate matter."
The Australian newspaper said Canberra was ready to reach a deal on the tax with the burgeoning coal-seam gas sector. The move would reduce uncertainty about A$40bn (£23bn) of liquefied natural gas projects in the coal-mining state of Queensland, Mr Rudd's political homeland and an area vital to his election chances.Reuse content