Gillard vows to resolve divisive mining-tax row
MINING giants BHP Billiton and Rio Tinto financed a seven-week advertising campaign to end a mining tax in Australia. Instead, they got a new prime minister.
The ruling Labour Party dumped Kevin Rudd, the architect of the tax, for Julia Gillard, Australia's first female prime minister, who opened the door to talks on the proposed 40pc tax that Morgan Stanley estimates would have taken A$85bn (€60bn) from the mining industry during the next decade.
"The mining tax was a big thorn in the side for Mr Rudd. I'm sure Ms Gillard knows that and she will try to negotiate a better outcome to make herself look popular," said Jason Teh at Investors Mutual in Sydney.
Ms Gillard ended the government's A$38.5m campaign backing the tax. BHP and Rio responded by suspending the campaign against the tax.
"My priority is to deal with the mining tax, it has caused uncertainty," said Ms Gillard. "I want to genuinely negotiate."
"We are not going to get our mojo back until the government is prepared to negotiate," said David Flanagan, chief of iron producer Atlas Iron. (Bloomberg)