Redistributing Wealth: Behind the Hype of the Mining Super Profits Tax

The resource sector’s response to Australia’s proposed 40% tax on mining profits was shock and disbelief. Mining heavyweights, including BHP Billiton, Rio Tinto and Fortescue Metals, wasted no time in mounting an aggressive campaign against a levy intended to pass a significant share of mining profits to taxpayers and underdeveloped sectors of the economy, on the grounds that it will make Australia uncompetitive. But others are happy. Superannuation groups are excited by a tax that will direct more funds into the A$1.3 trillion pension pool. However, top economists claim that the economic argument over the tax – and government taking a bigger role in the resources sector – has been lost in the discussion about wealth redistribution.