WA Labor warns over court action on MRRT

The West Australian government should not waste taxpayers’ money by joining a court challenge against the federal government’s mining tax if there’s no reasonable chance of success, state Opposition Leader Mark McGowan says.

Premier Colin Barnett says his government will not initiate any High Court challenge to the Mineral Resources Rent Tax (MRRT).

But he says if mining companies mount a challenge his government will intervene to make its opposition to the tax clear.

Andrew Forrest’s Fortescue Metals Group is considering mounting a legal challenge to the MRRT on the grounds it is unconstitutional.

Mr Barnett told reporters on Tuesday that that it could be argued the tax discriminates between states.

“It could be argued that the tax is on a mineral resource, which constitutionally the commonwealth government cannot tax – that belongs to the state,” he said.

“But look, I’m not a High Court lawyer, obviously. That’s part of the argument that would be mounted if a challenge comes on.”

WA Opposition Leader Mark McGowan said on Wednesday that the Barnett government needed to release any advice it had showing that a High Court challenge would be worthwhile.

He told ABC Radio that Mr Barnett had declined to say what chance of success such court action might have.

“I think it’s important to get to the bottom of whether there is a reasonable chance of success or whether this is just using taxpayers’ money in a wasteful manner.”

Mr McGowan said the mining tax would not be an issue at the state election in March 2013.

He said WA would want to get a fair share of the infrastructure fund to be set up to distribute some of the funds from the tax.

“All I’m saying to Mr Barnett is, focus on what you can get out of the commonwealth on this.”

Mr McGowan said he was “absolutely confident” that if Tony Abbott became prime minister, his government would keep the tax, despite Mr Abbott vowing to scrap it.

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