New tax to boost iron ore to China
By Maggie Zhang |
May 20, 2010, Thursday
|
Print Edition
Print Edition
AUSTRALIA'S proposed resources tax isn't based on price and will help increase supply of iron ore to China, its minister of trade said yesterday in Shanghai.
Resource-rich Australia proposed a 40 percent tax on what it defines as "super profits" on May 2. The tax has met with resistance from resources firms.
Simon Crean, Australia's trade minister, said the new tax is not based on consumption but based on profits, and therefore it will not boost prices.
The new resources tax will help encourage investment as it is a more "balanced tax regime."
He is confident that the new tax will not cut iron ore supply to China and instead will boost supply.
China, the world's biggest steel maker, is a major importer of iron ore - a key ingredient in steel making. High iron ore prices have eroded the profits of China's steel mills.
Resource-rich Australia proposed a 40 percent tax on what it defines as "super profits" on May 2. The tax has met with resistance from resources firms.
Simon Crean, Australia's trade minister, said the new tax is not based on consumption but based on profits, and therefore it will not boost prices.
The new resources tax will help encourage investment as it is a more "balanced tax regime."
He is confident that the new tax will not cut iron ore supply to China and instead will boost supply.
China, the world's biggest steel maker, is a major importer of iron ore - a key ingredient in steel making. High iron ore prices have eroded the profits of China's steel mills.
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