- CANBERRA: Australia’s minority government said on Tuesday it will not increase a planned 30 percent resource tax or extend it beyond iron ore and coal mines in order to maintain support from key independent and Greens lawmakers.
Labor Prime Minister Julia Gillard scraped back into office for a second term last week but must now rely on support from three independents and a Green member of Parliament to stay in power after dead heat elections on Aug. 21.
The mining tax legislation will be introduced into Parliament in early 2011, but it faces uncertainty with the Greens and one independent wanting the tax to include more mines and raise more money and the other independents seeking more debate on details.
“We’ve got no intention of extending it to other commodities or increasing the tax rate. That would be inappropriate, because they clearly were not on the table at the election,” Resources Minister Martin Ferguson said.
Ferguson said the Labor government would not change key elements of the tax, which it has negotiated with mining heavyweights BHP Billiton, Rio Tinto and Xstrata, and was a major election policy.
“As far as we’re concerned, we’ve gone to an election with a proposal. There’s an agreement, and our word has to stick,” he told Australian television.
The Greens, who will hold the balance of power in the upper house Senate from July 2011, have also urged the government to consider new curbs on uranium mining, but concede they do not have the parliamentary numbers to force a change in policy.
“The Australian Greens have always made as public as possible our opposition to uranium mining, nuclear power, nuclear waste and nuclear weapons and we intend to continue to keep on raising our concerns,” Greens Senator Scott Ludlum said.
Australia, the second largest uranium producer behind Canada, has the world’s largest uranium reserves and exports are forecast to grow to meet rising international demand for nuclear power as countries seek to cut carbon emissions.
The ruling Labor Party in 2007 abolished its long-held opposition to new uranium mines, although approval for new projects rests with state-based governments.
Gillard and her Cabinet were officially sworn in for a second term on Tuesday.
The government will face its first full test when Parliament meets on Sept. 28, when new lawmakers will take their seats and Gillard’s grip on power is set to be tested on the floor of the House of Representatives.

