A major iron ore firm Friday launched a High Court challenge to Australia's controversial tax on the mining boom as the government reiterated its intention to introduce the levy on July 1.
The Western Australia-based Fortescue Metals Group, the world's fourth biggest iron ore company, lodged a challenge to the Minerals Resource Rent Tax (MRRT) on constitutional grounds.
The firm, built by one of the nation's richest men, Andrew "Twiggy" Forrest, claims the tax favoured some states over others and restricted a state's ability to encourage mining, contrary to the constitution.
"We believe we have a good case for challenging the MRRT on constitutional grounds and we look forward to the resolution of these important issues by the High Court," the company's chief executive Nev Power said.
The mining tax, initially launched as a "super profits" tax, has been deeply controversial since it was first announced in 2010 and the violent backlash from powerful mining interests helped topple then prime minister Kevin Rudd.
Treasurer Wayne Swan said the government was determined to deliver the tax to ensure the community shared in the benefits of the mining boom, which is powering the resource-rich states of Queensland and Western Australia.
"The government believes Australia's non-renewable natural resources belong to all Australians, not just to a handful of mining billionaires," he said.
Critics have charged that the tax will drive investment overseas and make Australia more reliant than ever on growth in its biggest trading partner China but Canberra wants to use its revenue to fund pensions and infrastructure.
Under the law a 30 percent tax will be imposed on coal and iron ore miners once it makes Aus$75 million per year in profit.
The Labor government originally wanted a 40 percent tax on all profits generated by resources firms as the nation enjoys unprecedented demand for its huge mineral deposits, mostly from rapidly industrialising Asia.
But this was scrapped in favour of a 30 percent tax only on super-profits from iron ore and coal, after an intense lobbying campaign from the powerful and wealthy industry, led by BHP Billiton, Rio Tinto and Xstrata.