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The Australian Government introduced a resource rent tax on offshore oil and gas deposits in 1987 and since then it has raised in excess of an additional $1 billion a year in revenue over and above the normal company tax on income. At the time it was being introduced a great deal of controversy followed the proposed introduction of the petroleum resource rent tax (PRRT). On 2 November 2011, the Australian government introduced the raft of bills into Parliament for the imposition of a Mineral Resource Rent Tax (MRRT) on profit generated from iron ore, coal and gas from coal seams from 1 July 2012. Onshore oil and gas deposits will now be subject to a rent tax under the new PRRT regime that was also introduced into Parliament on 2 November 2011. The proposed MRRT has been met with criticism from certain mining companies, the Opposition parliamentary parties and noted economists. However, Australia currently has a budget deficit and a MRRT is being viewed by the government as being a solution to repaying government debt and to redistribute the burden of tax by reducing the rate at which companies pay income tax. A Resource Rent Tax (RRT) has been used by a number of countries such as the United Kingdom and Norway to increase government revenue from their ‘North Sea’ oil reserves. This paper will address the question raised above: namely, why is there opposition to a proposed MRRT given the continued existence of a PRRT in Australia for over 14 years? The paper will also contend that there are sound philosophical reasons for having this form of taxation and that as a result of the continued existence of a PRRT in Australia together with the fact that resource rent taxes have been adopted in many other countries, that the criticism of the new MRRT is unwarranted.

Item Type:	Refereed Article
Keywords:	Petroleum Resource Rent tax and Mineral resource rent tax
Research Division:	Law and Legal Studies
Research Group:	Commercial law
Research Field:	Taxation law
Objective Division:	Law, Politics and Community Services
Objective Group:	Community services
Objective Field:	Ability and disability
UTAS Author:	McLaren, J (Dr John McLaren)
ID Code:	128604
Year Published:	2011
Deposited By:	TSBE
Deposited On:	2018-10-02
Last Modified:	2018-11-26
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