Resource Availability-The Impact of Taxes

Taxes have an impact on mineral resource availability in several ways. There is the obvious effect on the grades needed for mineral deposits to become economic orebodies. There are also indirect effects which can have equally significant impacts. The paper examines the appropriateness of different types of taxes in the mining industry. The effects of discriminatory taxes such as price-based royalties are described. There is a discussion on the feasibility of introducing a single resources tax to replace completely the various forms of taxes presently applied to the industry. The subtle impacts of taxes are described in a section covering the way in which apprehension over future possible changes to both the level and diversity of taxes is reflected in industry confidence. It is concluded that taxation can significantly limit the economic availability of mineral resources.