In response to a “meaty” question from a shareholder at the company’s annual general meeting in Brisbane today, du Plessis said he and other directors were regularly asked about Australia’s sovereign risk by investors in New York and London.

“There is no doubt that Australia as an investment destination has changed for the worst,” he said.

“The way we look at Australia in the past two or three years has changed.”

As well as currency pressures, inflated wages and rising energy costs, the company would be impacted by the MRRT.

“I cannot say to you that we love it but we’re certainly not going to reopen the debate,” du Plessis said.

As one of the three companies that renegotiated the original resource super profits tax with the Labor government, du Plessis said it supported the MRRT.

He wasn’t quite as diplomatic on the topic of the carbon tax, saying it penalised the Queensland coal industry and advantaged Indonesian producers.

“Again, we have to accept it,” he said.

Du Plessis urged the federal government to implement measures to encourage investment.

“They need to provide a stable fiscal environment,” he said.

He said a long-term commitment to a stability and predictability would help to mend Australia’s damaged reputation.

Du Plessis said Rio paid $US7 billion ($A6.9 billion) in taxes in Australia alone last year, making it the second-highest taxpayer after its larger rival BHP Billiton.

Despite the cost pressures in Australia, du Plessis said the company would continue to invest in the country.

Shares in Rio last traded A13c higher at $61.39.