Resources tax mess

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Hen­ry Ergas explains what’s wrong with the Brown­ian ‘Resources Super Prof­its Tax’ (apart from the appalling, ide­o­log­i­cal snip­ing at for­eign investors).

Unfor­tu­nate­ly, we have a long his­to­ry in this coun­try of inter­ven­tions that, were they capa­ble of per­fect imple­men­ta­tion, might increase wel­fare. Typ­i­cal­ly, when real­i­ty hits, they have the oppo­site effect. The sci­en­tif­ic tar­iff, which helped ruin our econ­o­my for decades, is a strik­ing case in point.

The RSPT, with all of its com­plex­i­ties, risks being deja vu, all over again.” Extract from This tax won’t win any respect | The Aus­tralian

I won­der how Chi­nal­co now feels about it’s ago­nized invest­ments in Rio. Accord­ing to The Aus­tralian

Shares in Aus­tralian min­ing com­pa­nies shed more than $16bn this week, with heavy falls by BHP and Rio in Lon­don con­tribut­ing to a plunge on glob­al mar­kets overnight.

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