Treasury 'unable to know' how miners calculate tax they owe Treasury secretary Dr Martin Parkinson. Treasury boss Martin Parkinson says he remains blind to the size of crucial accounting measures that are helping big mining companies to reduce their mining tax payments, and will continue to be for some time yet. Speaking at a Senate inquiry into the Gillard government's mining tax, Dr Parkinson said that while his department had a fairly clear view of what was happening to the Australian dollar and commodity markets, Treasury was unable to know how companies were applying their "starting base deduction" when calculating their obligations under the tax. The starting base is the difference between the book value of a mining company's asset and the market value the miner judges the asset to be worth. Mining companies such as BHP Billiton and Rio Tinto have been using this as a deduction to their mining tax payments, and must apply it evenly over the life of the mine to a maximum of 25 years. Dr Parkinson said the size of that "starting base allowance" and the speed at which it was being written off were the crucial details his department could not see, and was likely to be the reason Treasury's revenue predictions have been so wide of the mark with regard to the mining tax. "It is fair to say we have been sufficiently concerned about our ability to work out what's going on," he said. We won't be able to come to grips with what has happened here until we can speak with industry. But Dr Parkinson said he had not asked the mining companies for clarification of those amounts and would instead wait for them to file their tax returns, which could be three to 12 months away. He defended that stance by saying it would be abnormal to ask companies for tax information before their submitting their annual tax returns. Iron ore and coal miners have paid $126 million in gross mining tax payments so far, well short of the $2 billion expected by Treasury this financial year. Tax Office commissioner Stephanie Martin stressed the payments made to date were only estimates by the mining companies, and the Tax Office could impose a penalty if they ultimately judged the companies had underpaid once full-year tax returns are lodged. Earlier on Wednesday the inquiry was addressed by economist Dr Richard Denniss from Canberra think-tank the Australia Institute. Dr Denniss called for the tax to be widened to include all minerals, particularly gold, copper and uranium. "We should simplify the tax by broadening it ... There is no reason to have excluded gold and we would be collecting a lot more revenue now if gold was included," he said. Bill Beament, managing director of gold producer Northern Star Resources, said perceptions that gold companies were still enjoying record high prices for their products were several years out of date. "We are not dealing with record high gold prices at the moment ... keep in mind costs are very high as well; there's not a lot of gold miners who make a lot of money at the moment," he said. Meanwhile Rio Tinto was refusing to comment on Wednesday on reports it had hired Deutsche Bank to help sell stakes in two of its struggling thermal coal mines: the Clermont and Blair Athol mines in Queensland.