Milne argues mining industry 'subsidies' should be scrapped

THE mining industry will be paid more than $13 billion over four years through rebates and concessions the Australian Greens want scrapped.

Labelling the fuel rebates and depreciation deals as "subsidies", Senator Christine Milne said the money would be better spent helping the country's less fortunate.

The resources sector dismissed the claims, saying not only were these not subsidies, but suggested the industry was not particularly well-supported by government.

Documents released by the Parliamentary Budget Office support the claims by the Greens, that $7.95 billion would be handed back to the industry through diesel fuel rebates between 2012 and mid-2016.

A further $5.9 billion will be returned by allowing mining companies to claim a higher rate of depreciation on assets and the work it takes during exploration.

"In one year alone, Labor plans to spend $4.45 billion on these fossil fuel subsidies," Ms Milne said.

"That's more than enough to increase Newstart by $50 a week and reverse cuts to single parents support.

"Public schools desperately need more funding, people on Newstart are living below the poverty line and we need a national disability insurance scheme now."

A spokesman for the Minerals Council of Australia - the lobby group for the sector - dismissed the Greens' demands as rubbish.

"The tax excise on diesel was introduced to help pay for public roads - the mining industry builds its own," the spokesman said.

"That is why we get a credit on the diesel we consume."

He said this did not amount to a subsidy.

The view is backed up by the Federal Government's own Energy White Paper, which says the fuel tax rebate fit with a principle of "not taxing business inputs".

He said being able to claim depreciation on assets and exploration was no different from any other business claiming its expenses, an option which should not be denied to mining companies.

The MCA is currently running a nation-wide advertising campaign warning political parties not to introduce higher taxation for the industry.