THE federal government must close a loophole in the mining tax that allows states to gouge the tax's revenue by raising royalties, a former federal minister says.
In response to an audience question on Q&A on Monday, Senator Chris Evans said the loophole was a problem.
"It's got to be fixed in my view and I think there's a process now with the states, " Mr Evans said.
Under the minerals resource rent tax the Commonwealth reimburses miners for any increases in state royalties.
The outgoing Labor senator said state governments were doing whatever they could to undermine the controversial tax.
"State level governments immediately abandoned the rhetoric and pushed up their royalties so the argument that somehow companies couldn't afford it went out the window," he said. '
In parliament earlier on Monday the Australian Greens put forward a bill to close the loophole and raise an additional $2.2 billion over the forward estimates and $3 billion by 2016-17.
But Minerals Council of Australia chief executive officier Mitch Hooke says fully crediting royalties was a key feature of the minerals resource rent tax's design, to avoid double taxation.
"Enough is enough," Mr Hooke said in a statement about what he called the continued obsession with increasing taxes on mining.
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