State Budget 2020-21: Contribution
CME is pleased to see the Premier recognise the significant contributions the WA resources sector has made to the WA economy throughout COVID-19.
The sector contributed $9.3 billion in royalties (an increase of 42 per cent from the prior year), accounting for 28.8 per cent of the WA Government’s general revenue in 2019-20. Royalty receipts continue to be the WA Government’s third largest revenue stream behind taxation and Commonwealth grants.
With revenue from the GST pool and whole-of-sector tax collections (payroll, transfer duty and land taxes) expected to decline during this period of uncertainty, the resilience of royalty receipts from commodities like iron ore will play a crucial role. For example, elevated iron ore royalties have contributed to the WA Government’s strong fiscal position, allowing it to announce the largest Asset Investment Program on record, which will be conducted across the state in 2021 and 2022.
The sector also contributed $13.38 million in payments levied upon construction work to the Construction Training Fund in 2019-20 (an increase of 24.5 per cent of what was budgeted). The resources sector is now the fund’s largest revenue stream by industry sector, materially ahead of commercial (by 20 per cent) and residential construction (by 37.5 per cent).
There has also been a 33 per cent increase in revenue received from mining, prospecting and exploration licences processed in the 2019-20 financial year.