Gold holds a special place in Victoria’s history and the economic development of the state. Now, with the Australian gold price at an all-time high, advances in mining technology and more ground being released in the state for minerals exploration, there’s renewed interest in one of our oldest industries.
Under current regulations, gold is exempt from royalties. This places Victoria as the only major gold producing jurisdiction in the world that does not collect a return on gold production. As a result, the benefits from gold production haven’t been shared fairly amongst all Victorians.
In the 2019-20 Victorian State Budget, the government announced it would remove the exemption, and a royalty of 2.75 per cent would apply to gold produced under a mining licence from 1 January 2020.
Importantly, to reduce the burden on small producers, the royalty will not apply to the first 2,500 ounces of gold produced under a licence each year.
The gold royalty is unlikely to impact gold production in Victoria because, based gold price forecasts and information about production costs, the mines that will pay the royalty are expected to remain profitable.
Revenue from gold royalty payments will benefit all Victorians by supporting the delivery of public infrastructure and services, both of which will increase economic activity throughout the state.
The gold sector in Victoria remains strong, with minerals exploration expenditure growth in the state outpacing national growth for the fourth consecutive year.
The government is introducing the gold royalty by amending the Mineral Industries Regulations.
This process requires that a regulatory impact statement is prepared and made available for public consultation.
Between 23 September and 21 October 2019, you can provide a submission on the Engage Victoria website.