Gillard-miners deal nearly there

The Gillard government and Australia's big three mining companies are now on the brink of an agreement that would end one of the biggest government-private sector debates in history.

Following significant progress in negotiations about a resources tax compromise this morning, BHP Billiton, Rio Tinto and Xstrata are reported to have consented with the government now on the key elements of a new resources tax structure. These elements include the creation of a new trigger point for the imposition of the tax, set at the 10-year Commonwealth bond yield plus 7 per cent.

The government is also believed to have resolved the miners' concerns on the retrospectivity of the tax is believed to have also been resolved with the government agreeing that the miners can inject their existing assets including the huge Pilbara iron ore mines and the rich east coast coal mines into the revised tax regime at market value.

Retrospectivity, the rate at which the tax is imposed and the headline rate of 40 per cent were the three major concerns of the mining sector. It remains unclear at midday, east coast time, what agreement had been struck on the headline rate, but the government reportedly have also given ground on this point.

The formal declaration of a deal could be held over, with the prime minister in far north Queensland today for the funeral of Afghanistan soldier private Ben Chuck.