Mining industry warns of investment retreat over Victoria’s proposed fee increase

The Minerals Council of Australia (MCA) is leading an attack on the Victorian government’s reported plans to add new fees and charges that would make operating a mine in the state even more expensive.

According to various sources, Victoria is proposing to introduce new mining costs that would raise operational fees to the highest in the nation.

The mining industry warns it will pull back on investment in Victoria if the proposed increases are imposed on the sector.

234% fee increase

Shadow minister for resources David Davis has alleged that the Victorian government plans to increase mine fees by 234%.

He said the new mining and extractive industry fees would drive miners from the state and push up the price of housing.

The shadow minister claimed any new taxes on miners and extractive industries would simply add more costs, while at the same time risking a reduction in revenue by driving projects from the state with extreme fees and a complex regulation process.

He accused the Victorian Labor government of being on a tax binge, increasing charges on Victorian households and businesses.

‘Sneaky hit on miners’

Mr Davis called the proposal a “sneaky hit on miners […] that is totally counterproductive.”

“There are now more than 60 new or increased taxes since Labor came to power almost 11 years ago in 2014,” he added.

“These planned levies, dressed up as ‘cost recovery for the resources sector,’ are just yet another Labor tax—it’s a blow to productive investment.”

“Extractive industries are direct inputs to housing costs; why would you increase them by 234% in a housing crisis?”

Mining investment disincentive

MCA Victoria executive director James Sorahan agreed that the new fees would be a disincentive to mining investment and questioned why Victoria believes it can charge higher fees than other states.

“Huge fee increases make no sense when the state is trying to encourage critical mineral development at a time when its gold production is declining,” he said.

“Higher fees simply increase the cost of exploration—every dollar in government fees, charges and taxes is a dollar less put into the ground in exploration.”