Tuesday 24th Oct, 2017

WA facing more opposition over gold tax

Kalgoorlie gold royalty protest. Photo: CME / Facebook
Kalgoorlie gold royalty protest. Photo: CME / Facebook

More than 1000 gold industry workers have marched through Kalgoorlie as opposition heats up over the WA Government’s proposed $20 per ounce tax hike on the precious metal.

According to multiple local and national reports, Kalgoorlie’s main street was filled with protesting workers on Monday, campaigning against new state treasurer Ben Wyatt’s proposed gold royalties plan, which aims to raise $392 million in additional revenue over the forward estimates.

Wyatt says the tax means little to gold miners, with a $20 royalty hike paling in comparison to current gold prices of around $1,640 an ounce.

But the gold miners have rejected this argument, saying their costs are higher than in any other comparable industry.

“In one of my mines alone, the drill database for the last 20 years has more drilling metres in it than the whole of BHP’s Pilbara iron ore division in the last 50,” Northern Star Resources executive chairman Bill Beament was quoted as saying last week.

“It gives you an idea of how much expenditure we need to put into the ground, just to be able to replace our resources and reserves.”

While $20 an ounce may seem like a small amount to increase the royalty by compared to the gold price, it is a large percentage increase: from 2.5% to 3.75%.

The Chamber of Minerals and Energy of WA has launched a new campaign called “Jobs First for WA” to fight against the plan.

“Our clear message to the Premier and his cabinet is Western Australian jobs must come first and an increase in the gold royalty rate and taxes will cost jobs,” CME chief executive Reg Howard-Smith said.

“The bottom line is increased royalties and taxes will cost jobs. It will result in the closure of mines, it will see a dramatic reduction in exploration and it will reduce the number of new jobs our industry can create.”

Treasurer Wyatt, who wants the royalty increase to trigger on January 1, 2018, dismissed the jobs argument as “just rubbish”.

“[The CME] resort to inflamed rhetoric without actually providing the sort of detail I have requested from them,” he said.