The re-election of Australia’s Labor Party, led by Prime Minister Anthony Albanese, has been met with optimism from the mining industry, primarily due to the government’s commitment to the Critical Minerals Production Tax Incentive (CMPTI). This legislated $7 billion initiative will provide a 10% tax credit for companies involved in downstream processing of critical minerals within Australia, aiming to level the playing field with global competitors and attract crucial investment.
While industry groups like the Association of Mining and Exploration Companies (AMEC) and the Chamber of Minerals and Energy WA (CMEWA) support initiatives like the CMPTI and the $1.2 billion Critical Minerals Strategic Reserve, they also emphasize the urgent need for broader improvements to Australia’s investment climate. CMEWA’s CEO, Rebecca Tomkinson, stresses the necessity of streamlining and accelerating federal environmental assessments, citing concerns about the recent decline in Australia’s investment fundamentals. The Minerals Council of Australia highlights the disparity in approval times, noting the significantly slower pace in the Northern Territory compared to Western Australia’s efficient online system.
Tomkinson argues that duplicative and cumbersome assessment processes are hindering Western Australia’s resources sector and the national energy transition. She emphasizes the importance of competitive corporate tax settings, manageable energy prices, and a balanced relationship between productivity and wage growth. Although initiatives like production tax incentives are appreciated, they cannot compensate for fundamental flaws in the investment landscape. With WA’s resources sector accounting for roughly half of the state’s economic activity and 9% of Australia’s GDP in 2024, addressing these issues is paramount to ensuring future prosperity.
