A new law imposing a 30 percent tax on iron ore and coal mining profits has been passed by Australian lawmakers, in a major victory for Prime Minister Julia Gillard's struggling minority government.

The new law, which has been the source of fierce battles between industry and government officials for two years, will affect around 30 companies, including international mining giants BHP Billiton, Rio Tinto and Xstrata.

The government hopes to raise A$ 10.6 billion ($11.2 billion) from the deal in its first three years, Reuters reported.

"This is indeed an historic day for economic reform, and an historic day for a fair go in Australia," Treasurer Wayne Swan told parliament, according to the Associated Press.

Australia has enjoyed a mining boom in recent years, and hopes to spread the multi-billion dollar tax windfall to other areas, including enacting corporate tax breaks, infrastructure spending and higher pension contributions.

The mining industry reacted angrily to the legislation, with the Association of Mining and Exploration Companies, which represents small and mid-tier miners, condemning the tax.

"The tax is simply unfair to smaller emerging miners, and is so complex that the administrative and compliance burden on industry and government will be extreme," association chief executive Simon Bennison said, according to Reuters.

"The introduction of this anti-competitive legislation in Australia will only further push investment capital offshore, and change our reputation as a safe place in which to invest."

SOURCE:IBTimes