The Treasury-KPMG Econtech Modelling of the Excess Burden of Mining Taxation: Some Doubts

Abstract

The Commonwealth Treasury commissioned KPMG Econtech to model the efficiency of the existing Australian tax system. The report was an input to the 2010 'Henry Review' of the Australian tax system (henceforth AFTS), and proved very influential to both it and (especially) the Rudd government's response to AFTS. That response comprised proposals for a new Commonwealth tax on mining, called the Resource Super Profits Tax (RSPT); a proposal to abolish royalties; and a proposal to reduce the rate of corporate income taxation. Subsequently, Treasury commissioned a second KPMG Econtech report to model the welfare effects of that response.