Independent MP Rob Oakeshott is concerned both sides of politics are dodging debate on tax reform.

Qld premier rounds on PM over royalties

Published: 12:45:09 PM, Wed 13 February 2013 UTC

Queensland Premier Campbell Newman says he won't be renegotiating mining royalties or tax arrangements with the federal government.

Prime Minister Julia Gillard has faced a week of opposition ridicule, after revelations the federal mining tax raised just $126 million in its first six months.

It had been forecast to raise $2 billion in its first year.

Ms Gillard responded by attacking reckless moves by state governments to increase royalties, which are refunded to mining companies who pay them through the federal mining tax.

She said the issue had been taken to the GST distribution review panel, which found the situation was both unsustainable and undesirable, and was now being discussed with state treasurers.

On Wednesday, Mr Newman warned Ms Gillard to remember Queensland's constitutional rights.

"The minerals that are in the soil of Queensland are owned by the people of Queensland and their state government. That's a constitutional thing," he told ABC radio.

"And royalties are imposed by the state under the constitution.

"So we are not going to see a situation where the federal government tries to dictate to us how those royalties occur."

He said it was entirely inappropriate for the Gillard government to be using the GST as a political weapon.

"The GST is another solemn agreement between the commonwealth and the states. Queensland and Western Australia, as resource states, are entitled to a fair share of the GST."

The premier said Canberra would have to act if they wanted to stop the commonwealth having to reimburse miners for any increases in state royalties.

"That's their problem and they have to deal with it. We're not going to cop any sort of suggestion that we should receive less GST," he said.

"We certainly think that the move by the Greens to take away this ability to deduct royalties is anti-mining and resource industry. I know they'll fight that hard."

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