MINERALS RESOURCE RENT TAX ACT 2012 [ REPEALED]

CHAPTER 2 - GENERAL LIABILITY RULES  

PART 2-3 - MINING PROFITS  

Division 30 - Mining revenue  

Subdivision 30-B - Revenue from supply, export or use of taxable resources  

SECTION 30-25   WORKING OUT AMOUNTS TO BE INCLUDED  

30-25(1)  
Work out the amount to be included under section 30-10 , in relation to a * mining revenue event that happens in relation to a * taxable resource , as follows: Method statement


Step 1.

Work out under subsection (2) the revenue amount for the * mining revenue event .


Step 2.

Using the method that satisfies subsection (3) , work out how much of that revenue amount is reasonably attributable to the * taxable resource :

  • (a) in the form in which it existed when it was at its * valuation point ; and
  • (b) at the place where it was located when it was at its valuation point.
  • The amount worked out under this step is the amount to be included under section 30-10 .

    Revenue amount

    30-25(2)  
    The revenue amount mentioned in step 1 of the method statement in subsection (1) is:


    Working out the revenue amount
    Item Column 1
    If the amount to be included relates to ...
    Column 2
    Then the revenue amount is ...
    1 A * supply of the * taxable resource , or a thing produced using the taxable resource The consideration received or receivable for the supply
    2 An exportation from * Australia of the * taxable resource , or a thing produced using the taxable resource What would be the * arm ' s length consideration for a * supply of the taxable resource or thing at the time and place the taxable resource or thing is loaded for export
    3 Use of a thing produced from the * taxable resource What would be the * arm ' s length consideration for a * supply of the thing at the time and place of the use.

    Note:

    Supplies covered by item 1 of the table that are not at arm ' s length may, in appropriate cases, attract the operation of Division 205 (anti-profit shifting).

    30-25(3)  
    The method to use in step 2 of the method statement in subsection (1) is the one that produces the most appropriate and reliable measure of how much of the revenue amount is reasonably attributable as mentioned in that step, having regard to:


    (a) the miner ' s circumstances, including, but not limited to, the functions performed, assets used, and risks borne by the miner in carrying on its * mining operations , * transformative operations and * resource marketing operations for the mining project interest; and


    (b) the available information.

    30-25(4)  
    In using the method that satisfies subsection (3) , make the following assumptions, to the extent that they are relevant to that method:


    (a) that a distinct and separate * entity (the notional downstream entity ) does all the things (including using all the assets) that the miner actually does in carrying on the * downstream mining operations , * transformative operations and * resource marketing operations for the mining project interest;


    (b) that the notional downstream entity does not acquire an interest in the * taxable resource ;


    (c) that the miner and the notional downstream entity deal wholly independently with one another;


    (d) that:


    (i) there is a market for what the notional downstream entity is assumed by paragraph (a) to do; and

    (ii) that market is competitive in the sense that the returns to the notional downstream entity would be no more or less than are necessary for it to commit capital, and in particular are commensurate with the non-diversifiable risks inherent in the things it does.

    30-25(5)  
    Without limiting subsection (3) , a miner is taken for the purposes of step 2 in the method statement in subsection (1) to use the method that satisfies subsection (3) if the miner works out how much of the revenue amount is reasonably attributable as mentioned in that step by:


    (a) reducing the revenue amount by an amount that, having regard to the matters mentioned in paragraphs (3)(a) and (b), is sufficient for a notional downstream entity to recover the following costs relating to the things it is assumed by subsection (4) to do, and the circumstances in which it is assumed by that subsection to do them:


    (i) any operating costs;

    (ii) any depreciation of assets;

    (iii) a cost of capital sufficient to justify the continued commitment of the capital; and


    (b) adding back to the revenue amount so much (if any) of the costs mentioned in paragraph (a) of this subsection as relate to things done to the extent that they were not taken into account in the revenue amount.

    However, the costs mentioned in paragraph (a) of this subsection only include costs to the extent that they reasonably relate to the * mining revenue event .

    Meaning of transformative operations

    30-25(6)  
    Operations or activities are transformative operations , for a mining project interest, to the extent that the operations or activities:


    (a) are operations or activities of a kind mentioned in paragraph 35-20(1)(a) for the mining project interest; and


    (b) involve doing something to, or with, the * taxable resources after they reach the form and location they are in when they are first applied to producing something in relation to which a * mining revenue event of a kind mentioned in paragraph 30-15(1)(c) happens; and


    (c) do not involve doing anything to, or with, those taxable resources after they reach the form and location they are in when that mining revenue event happens.

    30-25(7)  
    Operations or activities are resource marketing operations , for a mining project interest, to the extent that the operations or activities involve marketing, selling, shipping or delivering of:


    (a) * taxable resources in relation to which a * mining revenue event mentioned in paragraph 30-15(1)(a) or (b) happens; or


    (b) things produced using taxable resources in relation to which a mining revenue event mentioned in paragraph 30-15(1)(c) happens.


     

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