BHP wants tax rise to exclude existing projects

In a sign that Australia's biggest mining company may be starting to come round to -- if reluctantly -- the government's planned 40 percent "super tax" on profits, Chairman Jac Nasser said BHP had "no issue with a review of the tax system" as long as it was conducted around sound principles.

"Any reform proposal must only apply to new investments, not to existing investments," Nasser said.

Under the government's current proposal, Australian projects already in the pipeline -- some carrying price tags in the tens of billions of dollars -- would be taxed along with future investments. BHP has said its tax on profits in Australia would rise to 57 percent from 43 percent.

In a letter to BHP shareholders, Nasser said BHP now needed to make a deeper study of the implications before making future investment decisions.

Australian Prime Minister Kevin Rudd has so far resisted making concessions over the levy, which is aimed at helping fund social programmes. Some miners have compared the tax to a near-nationalisation of the sector.

Nasser, in his first public comments on the proposal since becoming chairman in March, also said stability and competitiveness in Australia's tax regime had until now allowed mining companies to invest billions of dollars in new projects despite exposure to adverse moves in commodities prices.

"The proposed super tax fundamentally, abruptly and unfairly changes the rules of the game," Nasser said.

The former Ford Motor president also warned that independent mining services firms, providing everything from staffing to heavy equipment to food and lodging, would also suffer under the tax.

Other Australian miners, including Rio Tinto and Xstrata , producing everything from coal to copper have been forced to rethink new projects in the face of the tax -- the world's stiffest on mining companies -- starting in 2012.

(Reporting by James Regan; Editing by Ed Davies)