Article by Noah Yim & Brad Thompson, courtesy of The Australian.
Anthony Albanese has backed in his government’s critical minerals tax incentive despite concerns from mining groups – now echoed by the West Australian Labor government – about duplication of green tape and Indigenous consultation under the Future Made in Australia agenda.
The concerns centre on an overarching requirement under FMIA for critical minerals mining and processing projects to deliver “community benefit” to qualify for some $7bn in tax credits over a 10-year period.
WA Premier Roger Cook has echoed concerns raised by mining lobby groups about creating another layer of approvals on top of those already required at state and federal levels to get resources projects off the ground.
In a submission to a Senate committee looking at legislation intended to deliver 10 per cent production credit tax credits to critical minerals processors, Mr Cook said duplication must be avoided and pointed out there had been no consultation on community benefit principles.
“The WA government looks forward to engaging with the Australian government on the community benefit principles set out in the bill, which have yet to undergo consultation,” Mr Cook said. “It is vital Western Australia understands how the principles and supporting processes will be applied to investment decisions.
“Flexibility is also sought on their application given our industry’s established engagements with its diverse local communities, where place-based contexts (actions within communities) are emphasised. Duplication of existing state and industry requirements and processes must be avoided.”
The Prime Minister stared down criticism from the Minerals Council and said the critical minerals productive tax incentive was “sensible reform”.
“Bear in mind this is production tax credits,” he said. “That is, it pays on success. Only if you’re successful do you get a credit on your tax by definition. It’s an incentive for investment and it’s something the Coalition are opposed to.”
He said the legislation was developed “in consultation with industry … The industry that I’ve met with in WA, and bear in mind that there are two bodies, the Minerals Council of Australia tend not to represent the WA bodies, which have their separate peak organisation as well. We’ve worked through those issues.”
The two other WA-based bodies Mr Albanese could have been referring to – the Chamber of Minerals and Energy of WA and the Association of Mining and Exploration Companies – have both echoed MCA concerns about the red tape.
“Introducing (community benefit principles) with separate reporting requirements under the FMIA will introduce additional compliance burden and duplication without enhancing the benefits to Australian communities,” CMEWA’s submission read.
AMEC echoed the sentiment. “The community benefit principles can and are being met by each mine and downstream processing facility in Australia,” its submission read.
AMEC also pushed for the whole tax group to be considered for this purpose.