Policy Forum: Resource Rent Taxation--Experiences from Australia

Wayne Mayo ()
Additional contact information
Wayne Mayo: Formerly of the Australian Treasury

Canadian Tax Journal, 2015, vol. 63, issue 2, 469-486

Abstract: Australia's community ownership of mineral resources and traditional value- or volume-based royalties imposed by regional governments in Australia's federal system set the scene for proposals to replace these traditional royalties with well-designed profit-based imposts. Such replacement offers better allocation of investment funds within Australia's mineral resources sector, including investment in marginal operations that would be unprofitable under traditional royalties, and full economic recovery of minerals. A recent Australian government proposed a cash flow tax of bold design incorporating delayed full loss offset (removing the risk, inherent in traditional resource rent taxes, of losing the value of expenditure deductions), as well as arrangements nullifying the effect of traditional regional government royalties. In the event, this bold design was not implemented, and one related insight is that full loss offset, viewed by one person as a crucial design feature for efficient outcomes, is a waste of taxpayer funds to another. Replacement of traditional royalties would require solid tax design coupled with meticulous and judicious consultation.

Keywords: Resources; rents; investments; neutrality; income taxation; Australia (search for similar items in EconPapers)
Date: 2015
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.ctf.ca/EN/Publications/CTJ_Contents/2015CTJ2.aspx (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ctf:journl:v:63:y:2015:i:2:p:469-486

Ordering information: This journal article can be ordered from
Canadian Tax Foundation, 145 Wellington Street West, Suite 1400, Toronto, Ontario, Canada M5J 1H8
https://www.ctf.ca/E ... ns_ListingBooks.aspx

Access Statistics for this article

Canadian Tax Journal is currently edited by Kim Brooks, Kevin Milligan, and Daniel Sandler

More articles in Canadian Tax Journal from Canadian Tax Foundation Canadian Tax Foundation, 145 Wellington Street West, Suite 1400, Toronto, Ontario, Canada M5J 1H8.
Bibliographic data for series maintained by Jim Lyons ().