An innovative mining company will bring more overseas processing back to Down Under.
Mineral Resources (MinRes) recently decided not to construct new refineries in China and do it in Australia instead.
“The risk for Australians in China is high and we do not want to trap money in China,” MinRes managing director Chris Ellison said according to News Limited.
Ellison revealed the East Asian country’s value added tax (VAT) was 3 per cent higher than the domestic goods and services tax. The communist regime’s other levies can also eat into proponent revenue.
“You can go and build a plant in China that is fine. Once you start operating it is far more expensive than operating in Australia,” he said according to the media outlet.
“You have got 13 per cent VAT on your [product] … in China you pay the Chinese tax, obviously, but then your money is caught there for a year and … if you send your hydroxide out of China and sell it here it was another 14.5 per cent VAT. Add all that up and you have still got to operate – that is half the reason we are not going to be in China.”
The remarks came months after MinRes confirmed it would shut down all offshore operations in China.
“Why should we go and give away that opportunity, and that value and the supply chain – and then run around and just keep digging rock out of the ground?” Ellison previously said.
“I want to create long-term businesses … [and] I see the real value in building these plants in WA.”