The Federal Government’s announcement of a $100 million Junior Mineral Exploration Tax Credit scheme will significantly boost investment and job creation in Western Australia, according to The Chamber of Minerals and Energy of WA (CME).
The scheme, which will allow tax losses made by junior explorers to be distributed as a tax credit to shareholders, follows on from last week’s announcement by the State Government to continue funding the Exploration Incentive Scheme (EIS) at a rate of $10 million a year.
CME Acting Deputy Chief Executive Kane Moyle said it was pleasing that all levels of Government were acknowledging the vital role the resources sector played in underpinning the economic stability and prosperity of the nation.
“The long-term future of the resources sector in Australia requires a healthy pipeline of active exploration of the State, however this is costly and capital intensive,” Mr Moyle said.
“Policies that advance exploration through incentives or credits such as today’s tax credit scheme and the EIS are critical in providing an incentive for resources companies to explore greenfields areas and facilitate new mineral discoveries in uncharted regions.
“After falling to decade-low levels, exploration expenditure in the State is beginning to show some positive growth and today’s announcement will further boost confidence in the sector.”
A sample of 46 WA resource sector operations in 2015-16 revealed the sector contributed $32 billion to WA and $14.6 billion to the rest of Australia by way of wages and salaries, business purchases, community contributions and royalties.