SA Mines and Energy Journal : August-Sept 2010
AUGUST/SEPTEMBER SA MINES & ENERGY JOURNAL 15 in exploration. "An FTS scheme would allow 'unused' deductions to flow to shareholders as an 'exploration tax credit' against their personal income taxes. It would encourage private investment during economic downturns, and make investment in exploration more linear and less dependent on world economics and commodity prices, " Mr Kuchel said. Junior explorers are particularly disappointed the exploration rebate proposal was dropped during the recent negotiations. "Junior explorers haven't been consulted in the MRRT. The detail has still to be sorted out and I would hope that there is still an avenue to negotiate there, "Mr Carter said. He suspects the details to be thrashed out on the new tax regime will prove complicated. "I do think that the exemptions and other details will be so complex that the next vocation you send your children into will be accounting, not law, " Mr Carter said. Kevin Malaxos, acting CEO of Centrex Metals, said while no additional tax would be welcome, the MRRT was more palatable than its predecessor. Centrex is planning for its first magnetite-producing operation to open on SA's Eyre Peninsula in 2014. Centrex and six other potential magnetite-producing mid-tier companies in SA, WA and the NT are backing SACOME's push to lift the threshold at which the MRRT tax applies because of the capital-intensive nature of their operations. "We believe the $50 million point is totally inadequate, "Mr Malaxos said. "The mid-tier players have discussed wanting to raise that to a $100 million threshold before the tax cuts in. "Our processing facility for our magnetite project will cost about $1 billion, and about $200-$300 million will be spent establishing FEATURE Prime Minister Julia Gillard, Treasurer Wayne Swan and Resources Minister Martin Ferguson announce a breakthrough in the mining tax stalemate. The new mineral resources tax now applies only to coal and iron ore.