Govt not worried by profit tax challenge

The federal government is confident it has nothing to fear from an anticipated High
Court challenge to its mining super-profits tax.
The Western Australian government is considering appealing the proposed laws on
constitutional grounds - depending on what the final legislation looks like.
WA Attorney-General Christian Porter believes there could be numerous grounds on
which it may be ruled invalid.
"I have no doubt, should this destructive tax reach the stage of legislation, that,
to prevent the economic vandalism that would occur, major constitutional litigation
would result," he told ABC radio.
"Western Australia is already planning for its role in that challenge should it come
to that."
Prime Minister Kevin Rudd is unperturbed.
"The commonwealth advises we're fortified in our constitutional position in that
regard," he told ABC radio.
Mr Rudd was flying into Mackay, north Queensland, on Thursday evening after nearly
48 hours in Perth, where he and a number of senior colleagues tried to turn public
opinion on the mining tax.
Opposition to the 40 per cent tax on so-called super profits - returns above the
long-term government bond rate of around six per cent - is strongest in
resource-rich WA.
A meeting on Thursday appeared to do little to change the mind of one of the tax's
biggest critics - Fortescue Metals boss Andrew "Twiggy" Forrest.
Mr Rudd wasn't commenting after the meeting but Mr Forrest was glad the prime
minister was finally listening to the sectors' concerns.
"From my perspective, we have much more wood to chop," Mr Forrest told reporters.
"(But) he's open to a process, and let's give that a chance ... I have a prime
minister who is listening and who has entered into a process."
His tone was much more conciliatory than Wednesday evening, when he dubbed the
government's consultative process a "charade".
The government had earlier strongly disputed that assessment.
"We are very constructive and genuine in that dialogue," Treasurer Wayne Swan told
Fairfax Radio Network.
The tax issue may not have as much intensity in Mackay but the region can expect a
lot of attention in the run-up to the federal election.
The seat of Dawson, where one-term incumbent James Bidgood is retiring, is up for
grabs.
Opposition Leader Tony Abbott got the jump on Mr Rudd - hitting Mackay hours before
his rival.
"It's absolutely essential that we don't destroy regional economies by stopping the
investment in new mines and killing the jobs that new investment would create," Mr
Abbott told reporters.
Despite warnings of doom and gloom if the tax goes ahead, for the moment, the
resource sector appears to be underpinning strong jobs growth in WA.
The state had the lowest unemployment rate - 4.1 per cent - across the nation.
And federal Labor shrugged off suggestions the tax will harm its electoral prospects
in WA.
Labor only holds four of 15 federal seats and faces a tight battle to hold Hasluck.
Mr Swan denied the government had given up in WA, where the Liberals hold the seats
of Stirling, Cowan and Swan by very slim margins.
"We are very serious about winning additional seats in Western Australia," he said.
Mr Rudd said Labor was "highly competitive" in WA.