The Government is today releasing draft legislation for the repeal of the Minerals Resource Rent Tax (MRRT).
Consistent with the Government's clear election mandate, the Minerals Resource Rent Tax Repeal and Other Measures Bill 2013 will abolish the failed MRRT from 1 July 2014.
The MRRT is a complex and unnecessary tax which struggled to raise the substantial revenue predicted by the former Government. Further still, this failed tax imposed significant compliance costs on one of our most important industries, while damaging business confidence which is critical to future investment and jobs.
The former Government linked a number of spending measures to the failed MRRT. These came at a significant cost to the Budget, to the point where the Government is borrowing money to pay for these commitments.
The repeal of the MRRT package contributes more than $13 billion of savings to the Budget's bottom line on an underlying cash basis over the forward estimates.
The repeal of the MRRT will contribute towards repairing some of the fiscal damage inflicted by the previous Government on our nation's finances.
Where the Government specifically outlined that it would keep a spending measure linked to the mining tax, the Government will honour that commitment. For instance, the Government remains committed to not rescinding the increase in compulsory superannuation from 9 to 12 per cent, currently paused for two years.
In relation to the Petroleum Resource Rent Tax, the Government is considering the issue of the onshore administration of this tax, in the context of its deregulation agenda and the removal of red tape.
Submissions on the draft legislation and explanatory memorandum for the repeal are invited until 31 October 2013.
The draft legislation is available on the Treasury website.