The mining tax has dominated Australia’s political landscape this week.

The Senate passed the mining tax on Monday imposing a 30 percent tax on super profits generated by mining companies from coal and iron ore. The tax revenue will be used to elevate income and pension funds of the less well-off Australians and to cut tax on small businesses.

This sent shockwaves to the mining industry which could have been rejoicing over mining boom worldwide.

Mining magnate Clive Palmer hits CIA of mining conspiracy (Photo: Andrew Mearse)

Queensland mining magnate Clive Palmer lashed out at the federal government and claimed the CIA is behind the mining tax as part of America’s conspiracy to kill Australia’s coal industry.

Palmer also accused the Greens as “tools” of the US government and the environmental activists group, Greenpeace, is funded by the Rockefeller Foundation.

He said he will lodge a double High Court challenge on both carbon and mining taxes.

But his accusation hits back like a boomerang.

The CIA via ABC email denied his claim prompting him to back away from inflammatory comments, Fairfax reports via SBS.

Crikey, an alternative online media source, said,

Now Clive Palmer again has demonstrated the eccentricity that comes from having so much money you don’t have to care what anyone thinks of you.

Palmer is doing no more than continuing Queensland’s rich tradition of conspiracy theorists, which has produced the Citizen’s Electoral Council and Pauline Hanson, to name only the most prominent of recent years. Nor is it the first time he’s accused people of being a CIA front — back in November, it was American Express who were doing the bidding of the spooks.

Palmer could probably find consolation in knowing another mining group, Fortescue Metals, confirmed it has sought legal advice ahead of plans to mount a High Court challenge against the Federal Government’s mining tax, News Corp said.

Chairman Andrew Forrest of Fortescue Metals leads a protest against mining tax during Kevin Rudd's time (Photo: Marie Nirme)

Fortescue claimed the MRRT is a poorly designed tax, drafted by the big miners behind closed doors to minimise their tax exposure at the expense of the rest of the industry,” the company said in a statement.

The Government is also facing a revolt from Liberal-led mining states.

Western Australia’s Premier Colin Barnett, for one, says he will support any legal action against the tax.

Not Amused

Newly appointed Foreign Minister Bob Carr blasts Palmer’s “reckless” CIA conspiracy claims.

He said the “recklessly irresponsible” claim that the CIA is sponsoring a campaign against the coal industry will trigger concern from the United States government and business community.

Carr said the comments should also make many Australians question  Palmer’s links to the Opposition. He noted Palmer is very close to Opposition Leader Tony Abbott and Palmer is considered the largest donor to the Liberal Party.

Foreign Affairs Minister Bob Carr (Photo: AAP/Alan Porritt)

Treasurer Wayne Swan has also denounced Palmer’s theory. He supported Carr noting that the mining businessman “is in cahoots with Mr Abbott.”

Federal Greens leader Bob Brown has echoed the remarks of Carr and Swan saying Palmer is a life member and a major donor to the Queensland Liberal National Party.

Meanwhile, Greenpeace senior campaigner John Hepburn rejected Mr Palmer’s comments as “ludicrous”. He said Greenpeace would not accept money from any government, corporation or secret service.

The mining tax was initiated almost two years ago, floated by former Treasury boss Ken Henry. It originally proposed a 40 percent tax on super profits — a proposal that stirred an industry-wide opposition rocking the Labor Party’s leadership. It was the same tax proposal that ousted Kevin Rudd from prime ministership in 2010.

Rising to power, Prime Minister Julia Gillard negotiated a modified tax rate with BHP, Rio and Xstrata although smaller miners remain unhappy with the deal.

The Mineral Resources Rent Tax (MRRT) Bill 2011 and related bills are now ready for the governor-general’s royal assent. The mining tax will start from July 1 this year, Australian media reported.

The federal government estimated the new tax will generate $11 billion in three years which will be used to elevate income of the less well-off Australians. It will boost compulsory superannuation contributions, infrastructure payment and a one per cent tax cut for business.

The Australian, however, is pessimistic over the tax. Its editorial page said:

While this newspaper recognises the benefit in ensuring that some of the revenue generated by the once-in-a-generation mining boom is secured for future generations, this tax will do little to drive reform in the slower sectors of the economy while the fastest-growing sector is slugged with a tax that could damage our competitiveness.

Opposition Leader Tony Abbott supports Palmer (Photo: Fairfax Media)

In defence of Palmer, Abbott said he was a “larger than life” character.

“I think when he says that the Greens want to stop the coal industry he’s absolutely right – of course the Greens want to stop the coal industry,” Abbott told Channel 10.

Abbott is vowing to repeal the tax if he wins the next election.