Home›Questions on Notice›QoN 1667

❓ The WA Parliament questioned the Treasurer on the required increase to the special lease rental charge on BHP and Rio Tinto to raise $238 million, both excluding and including GST impacts. The answer reveals a significant difference in the required charge depending on GST accounting.

AnsweredQoN 1667Legislative Assembly

Asked

8 August 2017

Member

Mr D.T. Redman

Portfolio

Treasurer

QuestionView source ↗

Using treasury modelling, what would the increase in the special lease rental charge (currently at 25c/tonne) on BHP and a Rio Tinto need to be to raise $238 million over the forward estimates, using the current long term bond rate as the discount applied in the modelling: (a) excluding impact of GST over the estimate period; and (b) NET of the predicted GST impact over the estimate period?

AnswerView source ↗

Answered

12 September 2017

Response time

9 days

These estimates assume an increase in the special lease rental charge from 1 July 2018, with additional revenue collected over the three years to 2020-21. (a) In 2017-18 present value terms (using an estimate of the long term bond rate), the special lease rental charge would need to be raised to around 40 cents per tonne. (b) In 2017-18 present value terms and accounting for all lagged impacts on the GST redistribution, the iron ore special lease rental would need to be raised to around $4.33 per tonne to raise $238 million.

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