Twelve years ago, Labor taxed Australia’s mining companies and now it wants to subsidise them with tax credits.

The Coalition wants to repeal those subsidies, declaring them “billions for billionaires”, but two years after the Minerals Resource Rent Tax (MRRT) was legislated in 2012, the Coalition repealed it so the billionaires could keep their billions.

But consistency has never been the basis of Australian politics, so let’s move on.

The MRRT replaced a resource super profits tax (RSPT), which was one of only three of 138 reform recommendations in the Henry Tax Review that the Rudd government felt inclined or able to implement. The subsidies of 2024 are part of a new Labor policy called A Future Made in Australia (AFMA).

And in a beautiful quirk of history, what was to be taken from miners then is almost exactly the same amount of money as is proposed to be given to them now.

AFMA is budgeted to cost $22.7 billion; the MRRT was budgeted to bring in $22.5 billion, although it only ended up making only $6 billion. The AFMA costings are almost certainly wildly wrong as well.

The proposed $2 per kilogram “tax incentive” for hydrogen production – the centrepiece of AFMA – is a case in point.

The cost of it is budgeted at $6.7 billion over 10 years or $670 million, on average, per year.

That’s an estimate of the cost, by the way, not a cap, so unlike most Labor policies it appears to be uncapped, at least for now.

The main reason for subsidising hydrogen production is to create a domestic green steel industry, the idea being that instead of exporting iron ore, we make steel in Australia using our abundant........

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