Fortescue loses high court challenge against Australia’s mining tax
Fortescue Metals Group (FMG) has lost a high court challenge against Australia’s Minerals Resource Rent Tax (MRRT), which came into effect on July 1 last year.
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FMG had argued that the tax was unconstitutional in that it discriminates between Australian states, curtails state sovereignty, gives preference to one state over another, and restricts a state’s ability to encourage mining.
The high court of Australia, however, unanimously dismissed proceedings brought by the iron ore miner on Wednesday August 7.
“Fortescue challenged the MRRT because it was an unreasonable intrusion into an area of state responsibility and that it was also an unfair, discriminatory and complex tax.
“We’re disappointed by today’s decision,” FMG ceo Nev Power said in a statement in response to the ruling.
The MRRT applies to coal and iron ore miners making more than A$75 million ($67 million) in annual profit.
The tax has reportedly raised A$126 million ($113 million) in the six months to December 2012.