The news follows a rejection in July of Senate changes to the Minerals Resource Rent Tax spending package, which included popular compensations for families, superannuation amendments and a schoolkids bonus.

According to The Guardian, negotiations with Clive Palmer’s Palmer United Party resulted in the abolition of the MRRT-related spending package, in turn setting up a repeal of the tax.

“We support the amendments put forward by the government because we must remove the mining tax … as soon as possible,” Palmer’s Senate leader Glenn Lazarus was quoted as saying.

“The tax is hurting investment in Australia and diminishing our competitiveness on the world stage.”

In a letter from Finance Minister Mathias Cormann to Palmer, Cormann thanked the mining tycoon for “very constructive discussions” leading to the repeal of the MRRT.

“As discussed, the government is committed to repealing the mining tax because it is a bad tax for our economy, jobs and the budget,” Cormann said.

Corman had previously noted that of the $A12 billion that was supposed to be raised by the MRRT in its first two years, only $300 million, or about 3%, had been realised.

This was put in the context of a budget with $17 billion in expenditures underpinned by forward estimates for MRRT proceeds.

The Association of Mining & Exploration Companies was among the first industry groups to weigh in on the decision.

“This is another step towards restoring Australia’s international competitiveness,” AMEC chief executive Simon Bennison said.

“The repeal demonstrates the government's commitment to reducing the cost of doing business. This will improve investor confidence and create more jobs for Australians.

“We must now maintain stability and certainty in public policy settings for long-term business and investment planning decisions.

“This is essential to sustain the mining and exploration industry to provide economic growth in Australia and support government revenue streams.”