19 Jul 2010

Mining tax compromise cost $A7.5 billion

7:55 am on 19 July 2010

A compromise with the global mining industry by the Australian government over its proposed new resources tax came at a big cost to its budget estimates - $A7.5 billion in concessions.

Radio New Zealand's Sydney correspondent says the dollar damage is revealed in new Treasury forecasts released as part of the lead-up to the federal election.

However, the revised resource tax remains a winner for the government - which is projected to receive $A10.5 billion over the first two years from the tax and lose only a net $A1.5 billion from the concessions.

A small dent in the forward estimates is due to Treasury upgrading its forecasts for commodity prices since the May budget.

Radio New Zealand's correspondent says that allowed the government to lift its projection for a return to surplus in the 2012/13 financial year from the original $A1 billion to $A3 billion.