The Australian Parliament has ratified the Albanese Government’s Critical Minerals Production Tax Incentive (CMPTI) legislation - one of the largest and most comprehensive nods of support for the resources sector in the country to the tune of $7 billion.
The incentives will provide companies with a refundable tax credit on 10% of eligible costs associated with the production of critical minerals and renewable hydrogen.
The Labor government says the CMPTI will be available for up to 10 years per project, for production between 1 July 2027 and 30 June 2040.
With U.S. President Trump’s decision to start withholding payments on the Inflation Reduction Act, there’s seen to be an increasing opportunity to attract investment that would otherwise go to North America.
A critical collaboration
Sector lobby group the Association of Mining and Exploration Companies (AMEC) was involved in developing the bill - a poignant mark of collaboration between business and government.
Working with its member companies, AMEC had commissioned a year-long report into production tax credits for the government, which formed some of the basis for the new CMPTI incentive.
“This is the first time any Australian Government has put their money where their mouth is in the critical minerals industry,” AMEC CEO Warren Pearce said.
“The CMPTI is a powerful strategic lever that provides the foundation for the Future Made in Australia ambitions of the country. It’s also the largest ever commitment from an Australian Government to critical minerals.
“This will stimulate billions in new investment in critical minerals processing, which will be far more valuable than the incentives on offer.”
Australian Federal Resources Minister Madeleine King said the incentives would be a game changer for the sector.
“The passing of this legislation is a historic moment for the resources industry and a big deal for resource states like Western Australia and Queensland,” King said.
“By processing more of these minerals here in Australia we will create jobs and diversify global supply chains.
“Critical minerals and rare earths are key to the world’s efforts to reduce emissions and vital to our national security."
Mudslinging
In a timely excuse to throw shade on political rivals, King said that despite receiving overwhelming support from industry groups and critical minerals companies across the country, the Coalition opposed the bill.
“Peter Dutton is more interested in playing politics than supporting our resources industry and this is evidence he has turned his back on our national security, on our resources sector and on hardworking Australians.
“Peter Dutton and the Western Australian Liberals have turned their backs on the Western Australian critical minerals and rare earths industry,” Minister King said.
Critical minerals and rare earths are used in solar panels, batteries and other technology needed to reduce carbon emissions.
They are also vital to the defence industry and are needed for the construction of submarines and aircraft.
