Junior Mineral Exploration Tax Credit Scheme
I rise today to thank the Prime Minister for his visit to the City of Kalgoorlie-Boulder last week.
While the big ticket item was the welcome announcement that the Goldfields region would be the next site for a Cashless Debit Card trial, another fantastic announcement flew slightly under the radar.
M. Speaker today I inform the Chamber that on the weekend, the Prime Minister announced a new $100 million scheme to stimulate investment in mining exploration, which is a fantastic result for the mining industry and completes what I think, has been a really positive week for the Goldfields.
This innovative Junior Mineral Exploration Tax Credit Scheme (JMTCS) is a replacement for the discontinued Exploration Development Incentive (EDI).
Similar to the EDI, the program allows junior explorers reporting losses for green fields exploration to offer a tax credit to their investors.
We’ve dubbed this initiative the Junior Mineral Exploration Tax Credit, but it’s more than just a rebranding of its predecessor.
Three years of the EDI taught us some valuable lessons, given the industry take-up of the scheme was less than we hoped and evidence suggested it wasn’t achieving its intended purpose.
Because the EDI had a cap on maximum expenditure for each year, we applied a modulation factor to manage the limited pool for money available.
Essentially, if the scheme was over-subscribed and the submissions exceeded the cap for that financial year, applicants would receive a reduced portion of what they expected.
This created a degree of uncertainty for investors, given companies would be unable to offer a guarantee to the market.
We’ve removed the modulation factor and applied a “first-in, best-dressed” method that will ensure successful applicants are guaranteed the tax credit they sought.
The other important factor of the JMTEC is that only newly issued shares relating to capital raising new greenfields exploration activity will be eligible for these tax credits.
This scheme is expected to leverage $300 million of investment in exploration over the next four years.
The latest figures for gold exploration in Western Australia are positive, but we know that is no justification for industry and Government to rest on its laurels.
We’re still short of the investment in exploration that we saw several years ago, and it’s my hope that as a Government, we can help the industry return to that level.
Big shout out to Simon Benison, Graham Short and the team at AMEC
And on that note M.Speaker it is with great pleasure that I will be attending the opening of Independence Groups Nova nickle mine at the Frazer’s Range, 130km’s east of Norseman this Friday.
Discovered in 2012 by Prospector Mark Bennet’s Sirius resources this is a classic storey of greenfeilds exploration opening up enormous opportunities for the goldfields economy.
The Nova mine will produce in FY18 25000t of nickle,11000t of copper and around 1000t of cobalt, bringing much needed jobs and income to the national, state and local economies.
I want to congratulate independence group Chair Peter Bilbe, MD Peter Bradford and their team for bringing this project to fruition and wish them all the best for the future.