The Prime Minister-elect, Tony Abbott, has declared
Australia is now 'open for business' with the pledge of
'real change' to bolster Australian business. The promised
repeal of the Carbon Tax and the MRRT are particularly significant
for the mining industry.
But will the promises convert to real changes? Despite
its electoral success, there may still be some roadblocks to the
Coalition's plans for real change...
RESOURCES AND ENERGY POLICY
The Coalition Government brings with it a raft of policy ideas
aimed at improving business and investment conditions for
Australia's mining sector. These include:
abolishing the Carbon Tax;
abolishing the MRRT;
establishing a 'one-stop-shop' for environmental
introducing an Exploration Development Incentive;
updating the Energy White Paper;
formalising the agreement to enable the sale of uranium by
Australia to India;
examining the potential of thorium as an energy source export;
establishing an industry advisory council for the energy and
CARBON TAX REPEAL
The Coalition has set an aggressive timetable for repealing the
carbon tax, promising to present legislation to parliament in its
first 100 days of government.
However, the Senate could prove to be an Achilles heel for the
Coalition's crusade against the carbon tax. It needs the
support of the Senate to pass legislation and that may prove
If the Labor Party and the Greens block the Coalition's
changes, then the Coalition will be faced with a choice of either
calling a double-dissolution election or waiting until 1 July 2014
when the newly elected senators arrive in the Senate.
Even if the Coalition waits for the new Senate, the Government
will probably still need to negotiate with independent and minor
party senators to pass legislation.
What impact (if any) this might have on the Coalition's
plans to scrap the carbon tax remains to be seen.
'ONE-STOP-SHOP' FOR ENVIRONMENTAL APPROVALS
Regulatory overlap and delays have been at the heart of concerns
raised by the mining industry for many years. In an effort to
streamline approvals processes, the Coalition promised to offer
State and Territory governments the opportunity to act as a
'one-stop-shop' for environmental approvals.
If they accept, the States and Territories would administer a
single approvals process, including approvals under Commonwealth
legislation such as the Environment Protection and Biodiversity
Conservation Act. The Coalition's policy also envisages
that the 'one-stop-shop' process could be extended to local
governments that wish to be involved.
This move is likely to be strongly supported by the mining
EXPLORATION DEVELOPMENT INCENTIVE
The Coalition has sought to incentivise mining exploration
through an 'Exploration Development Incentive'. The scheme
will target small exploration companies by limiting eligibility to
companies with no taxable income. Under the scheme, a tax credit
will be provided to Australian resident shareholders for eligible
greenfields exploration expenditure incurred in Australia. The
proportion of expenses that can be claimed as a tax credit will be
determined by the ATO. The scheme will start for investments made
from 1 July 2014 and will be capped at $100 million over the
CUTTING COMPANY TAX
The new Government has also promised a 1.5% cut to company tax
from 1 July 2015, bringing it down from 30 cents to 28.5 cents in
the dollar. However, this tax relief is counterbalanced by the
proposed paid parental leave levy of 1.5% on Australia's top
The Coalition believes the tax cut will boost Australia's
attractiveness to foreign investors and encourage Australian
businesses to invest, expand and employ more Australians.
Again, it remains to be seen whether the Coalition Government
will face any blockades in the Senate with respect to these
REAL CHANGE AHEAD?
The new Government can be assured the mining sector will closely
observe and monitor the implementation of its election promises in
anticipation of its broader promise of real change.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
Most awarded firm and Australian deal of
Australasian Legal Business Awards
Employer of Choice for
Equal Opportunity for Women
in the Workplace (EOWA)
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
It is a common misconception that the grant of mining tenure, whether it be an Exploration Permit, Mineral Development Licence or Mining Lease, will entitle the holder to access all land within it in order to explore or mine.
This briefing note sets out a likely structure for the proposed privatisation of the networks and identifies key issues.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).