SYDNEY, Feb 8 (Reuters) - Australia’s Minerals Resource Rent Tax (MRRT) raised A$126 million ($131 million) in its first six months of existence, far below what the government had hoped to make.
Treasurer Wayne Swan made the announcement in a statement on Friday, breaking a long silence on how much the hard-fought tax had actually raised.
In the budget last June, Treasury had first forecast that the tax on the super profits of iron ore and coal miners would make A$3 billion over the full fiscal year to end June 2013. It had also hoped to raise a total of A$9.7 billion in its first three years.
“It’s clear revenues from resource rent taxes have taken a massive hit from the impact of continued global instability, commodity price volatility and a high dollar,” said Swan.
“Revenues across the board are down very substantially - MRRT is a profits-based tax that raises more revenue when profits are higher and less when they are lower.”
Mining profits were hit late last year when prices for iron ore and coal, two of Australia’s biggest export earners, fell sharply. Prices for the steel making mineral have since recovered all their losses to reach 14-month highs, though coal prices have lagged well behind.
The tax was fiercely opposed by many miners and by the Liberal National opposition, which claimed it would badly hurt mining investment.
The hit to tax revenues has been so severe that the Labor government has had to renege on a pledge to balance its budget in 2012/13, a politically embarrassing move in what is an election year. (Reporting by Wayne Cole; Editing by Kim Coghill)