SACOME Annual Report 2012-13

FEDERAL ELECTION PRIORITIES
With the Federal Election in mind,
SACOME focussed policy work
in the final stages of the year on
developing and lobbying for a range
of issues identified as most critical
to advancing South Australia’s
mining and oil & gas sectors.
Lobbying commenced in the 2012/13
year and included consultation with
industry, partnering with other
state chambers to reinforce united
messages, developing a program
around meetings with Federal, State
and opposition leaders and many of
media releases.
These priorities were:
Implementing an exploration
tax credit scheme (exploration
development incentive).
SACOME has been calling for an
exploration tax credit policy for more
than five years. The scheme would
allow companies who are unable to
access tax deductions as they accrue
- given their lack of income - to issue
shares with these deductions ‘flowing
through’ to investors and make
investment in these juniors attractive.
In addition to promoting the scheme
with government, opposition, DMITRE,
other associations and the media,
SACOME took the initiative to develop
an Australia taxation system friendly
model and presented it to AMEC, the
MCA and other state bodies to garner
support. SACOME acknowledges the
work of Councillor and taxation expert
Alice McCleary in donating her time
and expertise to develop this model.
Addressing infrastructure needs for
resources project
These include the critical issues of
South Australia’s lack of a cape-size
vessel capable, multi-user port and
the upgrade of electricity transmission
network along the Eyre Peninsula to
enable projects in the region to develop.
SACOME lobbied for the use of bodies
such as Infrastructure Australia and
the Export Finance and Insurance
Corporation (EFIC) to provide funding
agreements to stimulate infrastructure
where the market has failed to deliver
a solution.
Changes to the Petroleum Resources
Rent Tax (PRRT)
SACOME lobbied hard for changes to
the PRRT that included amending the
tax so that profits below $50 million
would not apply, and the inclusion
of contiguous licences that allow for
exploration expenditure deductibility
relating to the same project from an
adjoining lease.
Rescinding the Mineral Resources
Rent Tax
SACOME recommended the MRRT be
rescinded due to the negative impacts
upon emerging iron ore miners in
South Australia, and in consideration of
reports highlighting that the minerals
industry already contributes its fair
share to State and Federal taxes.
Bilateral agreements
SACOME recommended revisiting
policy development in favour of bilateral
agreements for the Environmental
Protection and Biodiversity
Conservation Act, enabling
reductions in green tape.
Native Title Funding
Increased funding for the Native
Title Tribunal and Federal Court was
identifies among SACOME members
and Council as a high priority to
efficiently resolve outstanding and
ongoing native title claims.
Carbon tax
SACOME recommended the move
from Labor’s climate change policy
to a market based mechanism to
address climate change. SACOME
lobbied for a set of seven detailed
principles determined to provide a
fairer carbon pricing scheme for the
industry.
Exploration expenses deductibility
SACOME demanded the immediate
reinstatement of immediate
deductibility for exploration
expenses in the event of third
party acquisitions to encourage
investment back into the sector.
Retaining the diesel fuel tax credit
scheme
SACOME noted in its
recommendations that the Fuel Tax
Credit scheme must be retained.
Fuel Tax Credits are not a “subsidy”,
but reimburse taxpayers for tax
paid on a key business input. The
purpose of the scheme is to remove
the effect of fuel tax on business
inputs to ensure production
decisions are not distorted.
2012 - 2013 Annual Report
17