Reports


MTEC KEY PERFORMANCE MEASURES REPORT 2014

In 2014, enrolments across the minerals industry core disciplines of Earth Science, Mining Engineering and Metallurgy indicated some significant changes in how these disciplines are viewed by new entrants. Mining Engineering enrolments are dramatically lower in the 1st year, which will result in decreased graduates in coming years, following consecutive years (2012 and 2013)
of highest ever enrolments and graduates. Earth Science enrolments are higher in the 1st and 3rd years of study and are rising gradually in the honours (4th year). Metallurgy enrolments are slightly down across all years of study and steady on the long term average. It would also appear that the current minerals business cycle is impacting on students considering professional careers in the minerals industry.

The economics of fuel taxation in the mining sector

The Minerals Council of Australia commissioned Deloitte Access Economics to examine the economics of fuel taxation in the mining sector. In brief, this report explains why the principles of good tax design show that key justifications for taxing fuel do not apply in some circumstances. For example, if you aren’t using diesel on roads, then there’s no case to hit you with an implicit road user charge via fuel taxes. Most importantly of all, taxing diesel used as a business input would be inefficient, and would make Australians less well off. That is because it would mean that something is being taxed twice – once in the hands of the business, and again in the hands of domestic consumers. Such ‘taxes on taxes’ are inefficient, and hence typically bad policy. That is why Treasury has consistently supported the policy rationale behind fuel tax credits. In testimony to the Senate on 5 June 2014, Mr Rob Heferen of Treasury has noted that tax credits are: “... there to ensure that the double taxation does not occur. So the tax that is on the business input is relieved from the business activity. It is particularly important from a tax policy point of view. Certainly, with export competing industries, that double taxation obviously would be problematic.” This report also shows why fuel tax credits aren’t a subsidy: The only reason why money flows from the government back to businesses is because it is administratively easier for businesses to pay excess tax upfront, and then to have that refunded later. This is a common feature of the tax system. The same is true of GST refunds for GST paid by business, and annual income tax returns for excess income tax paid by individuals through the PAYG system.

The International Climate Change Effort

Australia has been wrongly cast, both in Australia and abroad, as a laggard in efforts to slow the growth of greenhouse gas emissions. Australia was one of the few nations that fully met (or exceeded) its obligations under the first commitment period of the Kyoto Protocol. The reality is that Australia’s economy has become substantially less emissions intensive over the last two decades. Treasury modelling demonstrates that the existing minus 5 per cent target will already impose higher economic costs on Australia than almost any other developed nation. The global nature of the climate change challenge requires an internationally aligned solution. This global response must be centred on three equal and fundamental public policy principles: environmental effectiveness, economic efficiency and social and political acceptability. Measures that are not global are unlikely to be environmentally effective. Measures that are not internationally broadly based are unlikely to be economically efficient. Failure to meet these principles undermines social and political support for action. Action by other nations has been patchy at best. A number of countries, accounting for over 80 per cent of global emissions, set emission abatement targets for 2020 under the Copenhagen Accord and were formalised as part of the Cancun Agreements. Each country chose its own target, base year and accounting methodology. The varying methodologies and bases used by each country make direct comparisons across countries difficult. This work by The Centre for International Economics compares national offers using common base years to give a closer comparison. It uses the official submissions of each country under the United Nations Framework on Climate Change Convention (UNFCCC). Ultimately, the measure of effort that a target represents is described by size of the reductions off 2020 “business as usual”. Australia’s targets are ambitious.

2013 ANNUAL REPORT - MINERALS COUNCIL OF AUSTRALIA

2013 was a year of significant change for the country and the MCA. In September Tony Abbott’s Liberal national coalition took office heralding a major change in direction for economic and industry policy in Australia. The new Abbott Government acted quickly on its election mandate to abolish the carbon tax – a move that will lift a $1.2 billion impost from Australian mining once the Senate approves the repeal bills.

Page 3 of 5 pages  < 1 2 3 4 5 > 

Top