OK, it's complicated. But given the role the controversial Resource Super Profits Tax may play in our nation's economic prosperity, it's important to gain some grasp of it.
The Government says the old tax system has failed to keep pace with the spiralling profits generated by the big miners. The miners believe the new tax is not a tax on "super profits" but on very mild profits.
This is how the tax would work.
Under the current system, mining companies pay 5 per cent of annual income to the state where they operate as royalties.
A company earning $300 million in revenue would pay royalties of $15 million.
It then pays federal company tax. This is calculated by deducting operating expenses of say $100 million, another $95 million for depreciation of equipment and $5 million for interest on money borrowed to pay for day-to-day running of the business. Read more.