Mining Taxes Under Review
November 1, 2012 New Zealand Taxation
Mining companies could soon be paying ore tax in New Zealand, following a new review by the government.
On October 31st the New Zealand government issued Reviewing the Royalties Regime for Minerals and Taxation of Specified Mineral Mining, two public consultation papers on the taxation of companies engaged in mining of minerals in New Zealand.
According to the Minister of Energy and Resources Phil Heatley, who announced the release, both papers are aimed at enhancing “…economic efficiency by ensuring that scarce resources are directed to economic activities that provide the highest returns before the imposition of tax and royalties.”
The review of the royalties paid by mining businesses suggest that a higher rate should be paid by operators, but the raised rate should only be applied to new businesses and not operations that have already been opened.
The paper on the taxation of mineral mine operators recommends that the tax deductions available to mine operators be removed and also calls for “…aligning the current concessionary tax regime for certain minerals with general tax principles that apply to other forms of investment.”
Public submissions on the papers are due by the December 7th.
Photo by buzzardsrule