PRIME Minister Julia Gillard is standing by Labor's mining tax even though it's raised only about six per cent of its full-year target and the opposition says it proves the Treasurer is incompetent.
As the Greens and independents demanded the government change the design of the tax to generate more revenue, Ms Gillard said she stood by its settings.
''The tax works as a profits-based tax and that is the appropriate design,'' she told reporters in New Zealand.
Ms Gillard said the resources sector was heading towards the peak of the investment phase before moving into a ''production boom'', which would lead to higher revenues.
Meanwhile, the Opposition is demanding Treasurer Wayne Swan's resignation after he revealed the mining tax collected just $126 million in its first six months.
The stunted revenue was the Federal Government's most embarrassing fiscal secret as the tax was scheduled to raise $2 billion in a full year.
"Wayne Swan is the most incompetent treasurer in Australian history," Shadow Treasurer Joe Hockey said in Sydney today.
"If Wayne Swan had any self-respect he would resign.
"This government has committed us to a lifestyle that we cannot afford - and they don't care."
However, Mr Hockey's attack was marred by a gaffe when he said that when the Coalition axes the tax it will also scrap a related rise in the superannuation guarantee from nine to 12 per cent.
He said paying for such measures would create a ''massive hole in the budget''.
Mr Hockey later issued a statement saying the Coalition was in fact committed to the increase in compulsory superannuation, but not other measures funded by MRRT.
The Opposition clearly was ready to skewer Mr Swan, who is banking on a revived international minerals market to bulk up the Minerals Resource Rental Tax.
"Wayne Swan is personally responsible for this mess and should seriously consider his position," Shadow Assistant Treasurer Mathias Corman said.
Mr Swan released the revenue figures from the Minerals Resource Rental Tax (MRRT) earlier today for the first time after the Australian Tax Office was assured no information about individual corporate taxpayers would be identified.
Originally the tax was to raise $4 billion a year, then $3 billion. But late last year that figure was downgraded to $2 billion.
The $126 million for the first two quarters of the tax indicates the full year's tax revenue will be nowhere near the revised target, even though mineral prices are on the rise.
Iron ore prices are about $155 a tonne, with economists believing they will rise further to about $160.
"It's clear revenues from resource rent taxes have taken a massive hit from the impact of continued global instability, commodity price volatility and a high dollar," Mr Swan said in a statement.
"Revenues across the board are down substantially - MRRT is a profits-based tax that raises more revenue when profits are higher and less when they are lower.
"The Government has always supported increased transparency in our tax system and we believe any revenue from the MRRT should be published, which is why I am making this information public after it was received earlier today."
Mr Swan said the Australian Tax Office was confident disclosing the first two quarters of the tax would not breach taxpayer confidentiality of mining companies.
The Nationals Barnaby Joyce was mocked by Mr Swan a few years ago when he confused billions and millions.
Today he had his revenge on the Treasurer.
''Three years ago when the tax was announced Wayne Swan promised to spend $6 billion on regional infrastructure, including $573 million for the Regional Development Australia Fund," said Senator Joyce.
''That was just one promise among more than $30 billion of other promises. Back then the mining tax was expected to raise about $4 billion a year now it will be lucky to raise $250 million.
''Clearly Wayne Swan has mixed up his millions and billions."
The Australian Greens declared Labor's mining tax a dud.
Greens lower house MP Adam Bandt said if it's not fixed before the May budget, there could be cuts to welfare and there won't enough funds for education reform.
''It's now clear that Labor's mining tax is a dud,'' he told reporters in Canberra.
Greens leader Christine Milne said the mining tax rate should be lifted to 40 per cent, loopholes allowing mining companies to be reimbursed for increased royalties paid to state governments must be closed and generous accelerated depreciation provisions removed.
She said those three measures could raise $26 billion over the next four years.
''It's time that we fixed this tax so we actually raise money from the big mining companies,'' she told reporters in Canberra.
Mr Bandt plans to introduce a bill to Parliament on Monday to remove the royalties loophole.
Greens Senator Richard Di Natale said the low revenue was the result of a watering down of the original resources tax proposed by former Prime Minister Kevin Rudd.
Liberal and Greens combined in the Senate this week to demand the Government release the taxes revenue performance.
The Greens want to impose a tougher tax to get more money while the Liberals have vowed in Government to abolish the MRRT.
Meanwhile, the mining industry maintained its argument it already pays a lot of tax, with a spokesman of the Minerals Council saying company tax and royalties last year amounted to $20 billion.
- with AAP