RIO spending up in Zimbabwe

Rio in US$300m project to raise diamond output

Reuters.

VICTORIA FALLS. Rio Tinto’s diamond unit in Zimbabwe said it has begun work on a US$300 million expansion programme to raise output six-fold, and has engaged the Government on ways to improve the investment climate in mining.

Mr Neils Kristensen, head of Murowa, the 300 000-carat-per-year diamond mine in southern Zimbabwe, said the firm had begun preparatory work for the planned expansion.
http://www.herald.co.zw/inside.aspx?sectid=19542&cat=8&livedate=6/2/2010

RIO is freezing new expenditure in Oz and going to Zimbabwe. What a hoot.
 
1) they could be freezing here temporarily. they can't hold out forever - it's a ploy before the election.

2) RIO / BHP / FMG are mining all over the world. one startup somewhere else doesn't immediately equal aussie exodus.

3) i hope they run zimbabwe better than their other african mines in Guinea/S.Afr etc
 
Assuming you have skills, would you stay in Aus if you were arbitrarily hit with a 40% surtax or would you take your money and skills somewhere you were more welcome?
 
Assuming you have skills, would you stay in Aus if you were arbitrarily hit with a 40% surtax or would you take your money and skills somewhere you were more welcome?

somehow i see plenty of people working in Aus and not going to places which have 0% personal tax.

i somehow doubt that you would go to Zimbabwe if you were hit with the 40% tax rate. I know i definitely wouldn't :D
 
http://www.herald.co.zw/inside.aspx?sectid=19542&cat=8&livedate=6/2/2010

RIO is freezing new expenditure in Oz and going to Zimbabwe. What a hoot.
I have been saying this for a while,, it may also pay to look at what China is spending in Africa,23 billion on refineries in Nigeria,20 billion on construction in Algeria,6 billion on infrastructure in the Democratic Republic of Congo,2.5 billion on Offshore OIL in Angloa,5.5 billion into banking in South Africa,every day this Government is wasting their time on the super tax on miners is another nail in the coffin of Australian Miners..willair..
 
? there is no 60% tax rate

we are talking about 40% here

any dollar I earn above 80k gets taxed at 40%

so effectively, if I have a job, which makes me more than 80k, and operate a business as a sole trader on top of that, my business gets taxed at 40% flat.
 
Their willingness to do business in Zimbabwe tells you all you need to know. There is no regime on earth RIO or BHP would not deal with if there was a quid in it.
 
we are talking about 40% here

any dollar I earn above 80k gets taxed at 40%

so effectively, if I have a job, which makes me more than 80k, and operate a business as a sole trader on top of that, my business gets taxed at 40% flat.
Your business gets taxed at 30% flat, and any dividends it pays you will carry franking credits @ 30% up to the amount of tax paid. You are not double taxed. You know perfectly well you don't pay the tax you claim. Why do you think we don't know?

Yes the top personal tax rate is 40%. But you don't pay 40% on every dollar you earn. It is also applied AFTER your finance costs are deducted. The miners are expected to pay 40% on EVERY dollar, before any financing costs. And they cannot write off exploration/development costs of the mine down the road they hope to get into production (you can open a new store and deduct direct costs). After all this they then pay 30% company tax on profits same as you.

Surely you can see that is a lot tougher than your tax burden, especially considering you can partake in financial engineering (such as -ve gearing) to reduce your tax?

But back to RIO. They perceive the risk/reward of doing business on that particular deposit in Zimbabwe to be better than what is on offer here. And why not? Zimbabwe is actually improving and Mogabe is a spent force. Here the lunatics are in charge of the asylum. That is what I was pointing out.
 
Your business gets taxed at 30% flat, and any dividends it pays you will carry franking credits @ 30% up to the amount of tax paid. You are not double taxed. You know perfectly well you don't pay the tax you claim. Why do you think we don't know?

I think you are describing a company structure.
I'm talking about Sole trader.

So while I wouldn't pay 40% on the whole of my income in that scenario, I would pay 40% on the part that comes from the business.
The miners are expected to pay 40% on EVERY dollar, before any financing costs.
Can you please elaborate a bit more on this bit.

miners are expected to pay 40% on every dollar of their super profit, which is after all the expenditure have been subtracted. there are certain deductions which are not allowed for the purposes of RSPT, but they will still be deductible from their tax return in a normal fashion.

also RSPT itself is income tax deductible, and miners will receive credit for any state royalties they pay.

Here is the document that outlines it all:

http://www.futuretax.gov.au/documents/attachments/Announcement_document.pdf
 
refer p31. they pay 40%, then a futher 30% on top. i think you have misunderstood this to be just a tax rate of 40%??

but then again you make a comment that it is deductibe for income tax, so clearly you understand that it is not the final tax. so... how do you compare an effective tax rate of 60% to your personal income tax? your average tax rate would be lucky to be 35% at worst
 
which paragraph you are referring to?

the way i see it is you will pay 40% on super profit, less the "cost of extracting resources and getting them to the taxing point (p30)" and any royalty credits.

then you will pay 30% corporate rate on your company's income less any deductions with RSPT being one of them.
 
but then again you make a comment that it is deductibe for income tax, so clearly you understand that it is not the final tax. so... how do you compare an effective tax rate of 60% to your personal income tax? your average tax rate would be lucky to be 35% at worst

my total average - yes, but not the tax rate of the business. the 40% came from what Sunfish suggested.

anyway, where did 60% come from? I thought even miners didn't claim it to be 60% :D
 
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