For every sustained $1 fall in the price of iron ore, the Australian federal budget would lose $300 million, according to Deloitte Access Economics director Chris Richardson.
Richardson’s thoughts were reported by The Australian. He said: “This fall of around $US9 we’ve seen would mean a loss of more than $2.5 billion a year in tax, if we assume one-third of Australia’s iron ore revenue is ultimately paid to the federal government.”
This is a huge loss of income for a government which has some headline promises to keep, and is already under self-induced pressure to get the budget back into surplus.
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