Mine companies in Western Australia have been given a welcome reprieve from skyrocketing rate rises issued by shire councils, with the state government announcing they will fast-track changes to the legislation.
According to the Association of Mining and Exploration Companies (AMEC) some mining companies have been hit with an 800 per cent increase in their rates due to a flawed valuation regime.
CEO of AMEC, Simon Bennison, said he had raised the issue as a matter of urgency with both the Mines Minister, Bill Marmion, and Lands Minister, Terry Redman last year.
WA’s Chamber of Minerals and Energy also made submissions to the Ministers over the issue.
“The unintended consequence of the Department of Mines and Petroleum’s escalating tenement rental schedule is that older exploration licences are valued higher for shire rating purposes, when in most cases they are no more valuable,” Mr Bennison said.
“The Ministers should be congratulated for understanding and addressing this issue and making it a legislative priority. Fast-tracking the amendments will ensure the unimproved value of mineral exploration licences will be calculated on the rent payable in the first year.”
Mines and Petroleum Minister Bill Marmion and Lands Minister Terry Redman said amendments to the Valuation of Land Act 1978 would address anomalies that led to excessive rises on some tenements.
Mr Redman said the new legislation would “drop the five times multiplier on petroleum permits and ensure the unimproved value of mineral exploration licences was calculated on the rent payable in their first year.”
“Land valuations and hence, local government rates, are calculated on multiples of 2.5 of these rent charges which resulted in these big jumps, years after legislation changes,” Mr Redman said.
“These changes will be welcomed by explorers and local governments, which have been under pressure from companies over these escalating rates.”
Mr Marmion said the introduction of cost-recovery for petroleum permits in 2013 had also pushed petroleum rents and rates up, with valuations calculated on five times the annual rent charged.
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