Fortescue Metals Insists Mining Tax is Unconstitutional

Fortescue Metals's lawyer told the Australian High Court on Wednesday that the minerals resources rent tax is unconstitutional. He cited the tax causing disadvantage to different resource projects in different states as his main argument.

In pushing for the repeal of the mining tax, Fortescue counsel David Jackson pointed to previous instances when Commonwealth excises, levies and tariffs were reversed based on the same argument he forwarded.

The MRRT imposes a 22.5 per cent tax on mining companies in Australia that extract coal, iron ore and coal seam gas if their total profit exceeds $75 million a year.

There are proposals to amend the MMRT, now being tackled by the Australian parliament.

Miners, however, have criticised against the MRRT because of the provision of allowances that gives larger tax concessions for investments made before profits are declared.

Queensland and Western Australia are intervenors in the case. The Wednesday hearing was the first of three such hearings before the High Court, which heard the legal challenge on a full bench.

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