The Queensland Resources Council says the state's decision to hike coal royalties is putting the viability of Queensland's coal industry at risk and claims the expected revenue has been "wildly" underestimated.
Treasurer Cameron Dick's decision to introduce new coal royalty tiers after a 10-year freeze on coal royalty rates amid soaring coal prices was met with strong opposition from the sector in June.
Under the tiers, royalty rates would rise from 15 per cent for prices above $300 per tonne to 40 per cent.
The increase was expected to tip an additional $1.2 billion into the state's coffers over four years, with Mr Dick pledging the funds to investment in regional Queensland.
But Queensland Resources Council (QRC) chief executive Ian Macfarlane said the state had already collected that $1.2 billion in just three months of the new royalty rates, and the sector would not accept the continued tax.
"They now have to justify why they've … doubled the tax to a point where investment in future mining operations in things like hydrogen is now in jeopardy," Mr Macfarlane said.
"Why have they done that if their figures show that they've already collected, in the three months of this financial year, everything they expected to collect in the four years of their budget?
"The mining industry is now seeing that our direst predictions are actually true.
"Firstly, that there'll be a vast amount of money collected from the industry which will impact on its viability, but also on investor confidence in investing in new projects."
Above global average
The QRC commissioned an analysis of the new royalty rates from consultants Commodity Insights, which revealed Queensland's royalty rates were now nearly four times higher than the global average of maximum rates.
The Commodity Insights report claimed the highest royalty rates – which the government said would only target high-price periods – would have kicked in for 60 per cent of the past decade.
A spokesman for Treasurer Cameron Dick said if prices performed higher than forecast, any additional royalties generated "would only be a fraction of the windfall profits that coal companies would be making from the resources owned by the people of Queensland".
International reaction to Queensland's new royalty regime has been strong, with Japanese ambassador to Australia Shingo Yamagami recently warning the hike carried "so much risk" and had affected the trust Japanese investors had in Australia.
The Commodity Insights report said Treasury's estimates were based on conservative coal price forecasts and argued the royalty revenue for 2022-23 could be between $6.9-11.9 billion higher than the department predicted.
"[That's] wildly exceeding their predictions," Mr Macfarlane said.
"The question has got to be, what are they doing with that money and why are they collecting such an extraordinary tax that places Queensland's economic future in doubt?"
Mr Dick's spokesman said Indonesian coal producers were currently paying higher royalty rates than companies mining in Queensland.
"Forecast returns from Queensland's new bipartisan progressive royalties arrangements are based on coal price modelling by Queensland Treasury, and align with forecasts used by coal companies when planning investments," the spokesman said.
"Regional Queenslanders deserve to see the benefit of high prices."
