The Australian Senate has overturned efforts by the Coalition to abolish the controversial mining tax introduced by the preceding government.
The Upper House of the Australian Parliament voted 35 votes to 32 to reject a bill launched by the Coalition which would have annulled the Minerals Resource Rent Tax (MRRT).
The bill was not expected to pass the Senate despite obtaining the approval of the Lower House in November last year, as the Upper House remains firmly in the hands of Labor and the Greens until July.
Rejection of the bill spells defeat for one of the key commitments made by Tony Abbott during campaigning in the lead up to the September election.
While addressing the Senate deputy opposition whip Anne Urquhart said the legislation was significant of the Coalition government's "utter contempt for Australian workers and Australian families."
Urquhart pointed out that the bill would provide the country's biggest mining concerns with a $3.3 billion tax cut at the expense of families, low income earners and businesses.
Greens leader Christine Milne called the bill a "blatant favour to the Prime Minister's big business mates," and accused the Coalition of pandering to influential mining concerns to the detriment of Australia's broader population.
"The Greens will never allow the Abbott Government to boost the profits of a few at the expense of measures that benefit so many and are vital for our future economic success," Milne said in a statement.
"We want a mining tax in the form it was recommended by the Henry tax review. We believe that instead of repealing it at the behest of big business, this tax should be strengthened."
The MRRT was introduced following the spectacular demise of Kevin Rudd's Resource Super Profits Tax, representing a compromise between the Gillard-led government and the mining industry. Under the compromised mining tax producers of iron ore and coal are obliged to pay 22.5 per cent of their profits to the government.
The new tax has drawn tremendous controversy and censure since coming into effect in July of last year, with revenues falling billions short of initial projections.
During Question Time Treasurer Joe Hockey was scathing in his criticism of the MRRT, referring to it as an "abject failure" which "is hardly raising anything" despite initial hopes for $12.5 billion in tax revenues.
"The problem is Labor spent the money they never got. Sixteen billion dollars of expenditure...they pre-spent against a tax that barely raises a dollar."