Fortescue Says Gillard Must Better Rudd Position in Mine Tax Negotiations

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30 Jun 2010

Fortescue Metals Group Ltd., Australia’s third-largest iron ore miner, said new Prime Minister Julia Gillard must make more concessions on a planned mining tax than canvassed by her predecessor Kevin Rudd.

Possible changes to the tax included reducing the effect of its retrospectivity, an immediate write-off for new capital and increasing the proposed return on investment trigger to 15 percent from 6 percent, Fortescue today said in a statement. A discussion paper was set to be released before Rudd was ousted last week as leader, the company said.
“We had reached a set of points which I think the prime minister was happy with, the mining industry would have been prepared to discuss and that was all taken off the table before it could be announced,” Chief Executive Officer Andrew Forrest told reporters in Perth today. “It was a shame really that it got cut off so violently.”
Gillard vowed to resolve a standoff with mining companies over the tax proposal after taking power. BHP Billiton Ltd. and Rio Tinto Group, the world’s largest and third-largest mining companies, suspended their anti-tax advertising as a sign of good faith after her appointment.

Source: Bloomberg