Negotiations With Mining Industry Over Tax Are Constructive, Gillard Says
Australian Prime Minister Julia Gillard said she’s encouraged by discussions over the fate of a proposed mining tax amid newspaper reports that a compromise may be in the works.
“I have been pleased by the constructive and disciplined approach that is being taken by both sides,” Gillard said in an e-mailed statement late today. “I have nothing to report on the content of the discussions at this point.”
Parts of the mining industry yesterday gave Gillard two weeks from June 25 to resolve a dispute over the proposed 40 percent tax, saying it would reinstate advertising campaigns opposing the levy should talks fail. Gillard and companies including BHP Billiton Ltd. stopped advertising last week after Gillard took office saying her priority is resolving the issue.
“I have indicated the importance of good faith negotiations on this issue of critical national importance,” Gillard, who ousted predecessor Kevin Rudd last week, said.
Gillard, Treasurer Wayne Swan and Resources Minister Martin Ferguson met in Canberra today with BHP Billiton Ltd. Chief Executive Officer Marius Kloppers, Rio Tinto Group’s Managing Director for Australia David Peever and Xstrata Plc’s coal unit Chief Executive Officer Peter Freyberg, the Sydney Morning Herald said on its website.
The government is prepared to cede “pretty much everything” to end the saga, the Herald said, citing an official it didn’t identify.
Talk of Compromise
Earlier, the Australian Financial Review also said a compromise could be in the works. The government may move to reduce the impact of the tax on existing projects while raising the point at which the levy kicks in from the current 6 percent, the Review reported without saying where it got the information.
Talks could extend throughout the week, Swan told reporters in Canberra during a late afternoon news conference.
“We’re not into megaphone diplomacy, we are sitting down in good faith discussing matters with a wide range of people,” Swan said at a news conference outside of Parliament House.
BHP shares fell 1.2 percent to A$37.65 at the close of trading on the Australian stock exchange in Sydney and Rio declined 2.6 percent to A$66.66. Australia’s currency traded at 85.45 U.S. cents at 4.54 p.m. in Sydney from 84.87 cents in New York yesterday.
Fortescue Metals Group Ltd. Chief Executive Officer Andrew Forrest yesterday said Gillard must make more concessions on the tax, announced on May 2 by former leader Kevin Rudd and Swan.
“We had reached a set of points which I think the prime minister was happy with, the mining industry would have been prepared to discuss and that was all taken off the table before it could be announced,” Forrest told reporters in Perth yesterday. “It was a shame really that it got cut off so violently.”
To contact the reporter on this story: Gemma Daley in Canberra at gdaley@bloomberg.net
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