SA Mines and Energy Journal : June-July 2010
JUNE/JULY 2010 SA MINES & ENERGY JOURNAL PRESIDENT'S REPORT 5 The proposed resources super profit tax (RSPT) is simply astounding! The South Australian resources industry is not opposed to making a fair contribution, but this tax slams an industry already punching above its weight with respect to its contribution to the Australian economy. Australia wide, our industry comprised about 8 per cent of the total economy last year, yet contributed about 16 per cent to the total income tax bucket. Furthermore, Australian Taxation Office records show that the resources sector pays 13 per cent more tax than others. The success of the resources industry is essential to the lifestyle of Australians so it defies common sense to impose such a tax on the industry when it is one of the few sectors generating real growth. Explorers and miners are struggling to understand why this productive sector has been singled out for such heavy-handed treatment. Few outside the resources industry realise just how difficult an industry this is. A mineral discovery costs millions of high risk dollars and is followed by extensive permitting, battles with ground conditions, variable metallurgical recovery rates, varying commodity prices and exchange rates. By the time a mine is commissioned, margins can be extremely tight. Even though the industry is well supported by our State Government, the real money for finding economic mineral deposits comes from shareholders at the front end of exploration. Making this industry less attractive to investors has real implications to our sovereign risk profile and to the viability of resource projects. The Federal Government has been naïve to think this reform wouldn't have a negative impact on mining activity. Members can be assured that the SACOME is working hard to protect our important sector. We need a tax system that is fair for all stakeholders and competitive on a global scale to ensure the continued growth of the industry, state and nation. ASTOUNDED BY PROPOSED SUPER PROFIT TAX A word from the President John Roberts • POWER GENERATION • CONTROL SYSTEMS • DESIGN & INTEGRATION • INSTRUMENTATION • PLANT UPGRADES • PLC & SCADA • INSTALLATIONS With over twenty Ýve years experience in the Ýeld the Frostec Group are a specialist provider committed to our customers and passionate about our business. FROSTEC PTY LTD www.frostec.com.au Ph. (08) 8366 0660 Fax. (08) 8234 6675 24hr. 0422 927 610 WHEN QUALITY & RELIABILITY COUNT Holden and SACOME are partners. Thanks to our partnership, we re offering every company that s a SACOME member the opportunity to purchase vehicles at heavily discounted prices. With a wide range of Holdens to choose from, including the hard-working Colorado, there s a vehicle to suit your budget and your needs. Visit your Holden Dealer today and take advantage of the savings you re entitled to, as our partner. Go better. Buy any new Holden and see that being partners really pays off.