Gillard calls for tax truce

THE Australian government signalled last night that it was now open to renegotiating the 40 per cent headline rate of its proposed mining tax, which has angered resource companies.

New Australian Prime Minister Julia Gillard made no promises about changes to the tax but her pledge to open negotiations prompted positive statements from the two giants of the industry in Australia, BHP Billiton and Rio Tinto.

BHP chief executive Marius Kloppers said: “We look forward to working with the government in this new way so as to quickly find a solution that is in the national interest.”

The controversial new resources tax, which was proposed by former leader Kevin Rudd, would have placed a 40 per cent tax on mining profits from 2012.

A raft of miners had previously threatened to pull out of more than $20bn (£13bn) of new projects after the former government rejected their appeals to cut the rate of the controversial tax.

Gillard said yesterday she had suspended an A$38m (£22m) advertising campaign explaining the tax. The miners have in turn agreed to stop their anti-government rhetoric. “We are genuine in our desire to negotiate with the industry,” added Gillard.