WA state royalties sink feds budget

[sprintcyclist]

one little pidgeon come home to roost you useless leftwits.

A war of words between the Western Australian and Federal governments over iron ore royalties has intensified with a Labor Senator accusing the WA Premier, Colin Barnett, of throwing a tantrum.

Mr Barnett has announced plans to increase the royalty rate paid on a certain type of iron ore in a move expected to earn the State Government $2 billion dollars over three years.

The Commonwealth has warned that, if the plan goes ahead, it will be forced to cut WA's share of GST revenue.

WA Labor Senator, Chris Evans, has accused Mr Barnett of being hypocritical because he was a vocal opponent of the Federal Government's plans to impose a Minerals Resource Rent Tax.

"The current tantrums quite frankly do him no credit," Senator Evans said.

"This Federal Government is absolutely committed to supporting infrastructure in Western Australia but you cannot have it both ways, you can't double dip."

The increase in state royalties will blow a $2 billion hole in the Federal budget and the Commonwealth says WA's share of the GST pie will have to be cut as a result.

The Federal Member for Perth, Stephen Smith, says Mr Barnett was well aware of that when he made the decision to increase royalties.

"When a state premier does that, he does it with his eyes open and he knows that there are bound to be consequences," Mr Smith said.

"Now we need to work our way very carefully through those consequences, they're consequences caused by Colin Barnett."

WA's Deputy Premier, Kim Hames, says the Commonwealth should stay out of WA's business.

"They take our resource, they take the money from that resource and they spend it all in the eastern states," Dr Hames said.

"Well, if they want a fight, then we're ready for it."

http://www.abc.net.au/news/stories/2011 ... n=business

[Rainbow Moonlight]

As I understand it Federal government wil simply spend that much les son infrastructure in WA. It is a cynical move by the WA premier to take advantage of Labor's intent to refund royalties to mining companies.

[Jovial Monk]

Yup. WA families and businesses including the miners are getting squeezed (cost of living is skyrocketing) and money being pared back across the board to keep paying the Royalties for Regions the Agrarian Socialists demanded as the bribe to get them in coalition with the Libs.

The idiotic Green refusal for one vote one value has led to this state of affairs.

[sprintcyclist]

As I understand it Federal government wil simply spend that much les son infrastructure in WA. It is a cynical move by the WA premier to take advantage of Labor's intent to refund royalties to mining companies.

that was the alps threat.
that was not a point in any budget or "Deal".
You can't do business with the alp as thehy change the rules ALL the time.

the alp are very destructive to businesses.

[Rainbow Moonlight]

? That comment seems completely irrelevant to me.Want to explain how it applies?

[Plough]

What the WA government is doing is setting the scene for a constitutional challenge against the Mining tax. You see the Federal labour government seem to forget that royalties are not a tax. They are the payment from the mining companie to the state (in this case wa) that owns the resourses. It is well with in the right of each state to charge for the resourses owned by that state what they deem fit. Afterall it is the people of WA who own these resourses not the people of NSW or Victoria. You will note that there is Bypartisan support in WA for the royalty rise.

Now constutionaly a goverment cant create a tax that purposley taxes one state more than another. This mining tax does exactly that. The comment in the media from respected legal people over here in the wild west is that there is a very strong case to have this tax deemed uncontitional.

Add to this that as a % of GST collected WA receives ~only 60% the balance going to prop up other non performing states, gives the WA government every incentive to raise royalties. The Federal government is only issed at this because they agreed to refund all royalties charged as part of the deal done with the 3 big mining comapinies to get this abortion of a tax through.

This federal government will sonn have the same problem with QLD and SA as they start to ramp up royalties on their big mining projects. Particularly SA where the new Olympic Dam project will be hit very hard.

it is yet another example of a federal government which has NFI.

[Jovial Monk]

Bwahahaha Barnett has to keep feeding the Nats the Royallties for Regions. Glad the Lib fanbois don’t see that. Do you love your sky high cost of living there in WA?

In 20 years time when the minerals are gone again WA will be a claimant state again, relying on the rest of the country to support you.

Not only that, each state pays different amounts of tax: income, company, GST whatever.

[Plough]

Bwahahaha Barnett has to keep feeding the Nats the Royallties for Regions. Glad the Lib fanbois don’t see that. Do you love your sky high cost of living there in WA?

In 20 years time when the minerals are gone again WA will be a claimant state again, relying on the rest of the country to support you.

Not only that, each state pays different amounts of tax: income, company, GST whatever.

Cost of living is high here, yes But at least we have jobs and ecconmy that is growing. I hazard a guess that where you live may be struggling a bit!. However there are more than 20 years of resourses left to rape from this big brown state

You also fail to address the issue of who owens the resourses. It is not the people of WA's fault that government in its haiste to get this abortion of a tax through promissed to refund state royalties. It is the fed governments failure to understand who owns the resourses that is the root of this problem. They are trying to grab a state owned asset and ditribute it nationally. I wonder how the people of NSW and Vic would react to that if the reverese were happening.

Yes you are right different amounts of tax come from different states but those taxes are predicated on an equal footing. Ie: all mining will be taxed. The resourses rent tax only attacks iron ore and uranium. It atttacks mining that is only done in WA, and to a lesser extent QLD and SA. Coal for instance, which is mined in NSW is excluded, Bauxite is excluded. This unfairley targets one, in particular but to a lesser extent 3 states out of the 6 states.

[Jovial Monk]

Another point is, royalties are a cost of production and apply right from the first spadeful over overburden removed. Barnett has just increased costs for WA miners incl projected mines. Rather silly.

Commonwealth can tax corporations—no constitutional challenge will succeed. I am sure your lawyers are salivating at the chance to be involved in a bid to do so—charging what, $10K/day what barrister wouldn’t?

I think you will find it will be less than 20 years, not more. That infrastructure might allow non-extractive industry to grow, much liek the roads for the Snowy Hydro scheme made possible the ski lodges etc. But keep paying the Nats bribes bozo! During Howards fuckup of a term the Nats wasted/rorted $40Bn of taxpayers money. The WA Nats are trying to beat that record I think.

[Plough]

Another point is, royalties are a cost of production and apply right from the first spadeful over overburden removed. Barnett has just increased costs for WA miners incl projected mines. Rather silly.

Commonwealth can tax corporations—no constitutional challenge will succeed. I am sure your lawyers are salivating at the chance to be involved in a bid to do so—charging what, $10K/day what barrister wouldn’t?

I think you will find it will be less than 20 years, not more. That infrastructure might allow non-extractive industry to grow, much liek the roads for the Snowy Hydro scheme made possible the ski lodges etc. But keep paying the Nats bribes bozo! During Howards fuckup of a term the Nats wasted/rorted $40Bn of taxpayers money. The WA Nats are trying to beat that record I think.

I think you will find you are wrong