Both BHP Billiton Group and Rio Tinto have rejected a proposal by the Western Australian government to make an upfront payment to settle the new iron ore tax, The Australian reported Oct. 4.
The proposal, which would have seen an upfront payment of over A$1 billion, would include scrapping a 25-cents-per-tonne production rental.
ABC wrote the same day that Western Australia's Nationals leader Brendon Grylls said he will not compromise or negotiate on the proposed mining bill, which recommends a A$5-per-tonne levy on mining majors, translating into a A$7.2 billion charge.
Spokespersons for BHP and Rio Tinto confirmed that the state government has forwarded the upfront payment proposal; however, both companies rejected it, with a Rio Tinto spokesman saying the company "is already making a significant contribution to the WA government."
The tax proposal, put forward by Grylls in a bid to deal with the state's budget deficit, has been dismissed by both the Liberal and Labor parties, and has been termed the "single biggest political risk issue" by BHP and Rio Tinto.
In August, Rio Tinto and BHP wrote to their respective employees, warning them of possible job cuts if the proposed A$7.2 billion tax on the miners is imposed.