Australia: New ad valorem mineral royalty scheme (Northern Territory)
Legislation that changes the way mineral royalties are calculated in the Northern Territory passed in the Legislative Assembly.
New ad valorem mineral royalty scheme in the Northern Territory
The Legislative Assembly of the Northern Territory passed legislation that changes the way mineral royalties are calculated in the Territory.
The Mineral Royalties Bill 2024 introduces a new ad valorem royalty scheme from 1 July 2024 for the calculation, payment and administration of mineral royalties for new mines that commence from 2024.
According to the Northern Territory government, the scheme incorporates four mineral treatment categories, applying four royalty rates that balance competitiveness with other jurisdictions while also providing a fair return for its natural resources.
The four royalty rates that will apply are:
- 7.5% for the least refined minerals
- 5% for concentrates
- 3.5% for chemically refined minerals
- 2.5% for final or highly processed minerals
Meanwhile, the current profit-based mineral royalties scheme contained in the Mineral Royalty Act 1982 will be grandfathered for all existing mines that were in production in the 2023 calendar year.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.