Findings from the mid-year Budget update affirm that the Queensland Government has underestimated the consequences of its decision to lift the coal royalty tax rate to the highest in the world, with Queensland Resources Council (QRC) Chief Executive, Ian Macfarlane, claiming the conservative estimates indicate coal royalties will be nearly double the original forecast.
“By lifting the top coal royalty tax rate to five times that of New South Wales, royalties are now expected to hit $10.7 billion in Queensland, more than $5 billion above what the government was expecting,” Mr Macfarlane said.
“$3 billion of that is the result of the new royalty tiers.
“It’s a long way from the Treasurer’s claim that the new coal royalty scheme would generate an extra $800 million over the entire year.”
Mr Macfarlane said it is evident the government miscalculated the revenue the new royalty tax will generate, and the long-term damage it will cause to the resources sector.
“The Government got it wrong about how much its royalty tax increase would collect, and it’s got it wrong about what these changes mean for the future of one of Queensland’s most important industries.
“We are already seeing major investors like Japan, and BHP and Peabody casting doubt on investing in new projects after the Queensland Government introduced increased royalty without any consultation,” Mr Macfarlane said.
“We know others will follow and that poses a serious threat to future investment and jobs in an industry as important to Queensland as resources.
“If the Government got the figures so wrong after just five months, how can we believe the numbers in the Budget outlook?” Mr Macfarlane said.
Mr Macfarlane said this is why the QRC encourages the government to sit down with industry to discuss the issue, rather than hike up taxes with no idea about the long-term consequences for Queensland.
“We again ask the Treasurer to meet with us to discuss the future of Queensland resources projects and to keep Queensland competitive,” Mr Macfarlane said.
