The Australia Institute has assessed the proposal for a $5 levy on iron ore in Western Australia. The policy should be supported as a pragmatic alternative to a resource rent tax.
The analysis finds that if the $5 levy had been imposed on relevant production over the last five years it would have raised $11.5 billion for the state.
“The iron ore mines that would pay the proposed fee have very low costs of production, with costs ranging from $US15-20 per tonne. With the price outlook at $US47-54 through to 2020, a $5 per tonne levy is very reasonable, affordable and fair,” Executive Director of The Australia Institute, Ben Oquist said.