The Greens have launched a new bid to force the nation's biggest miners to pay up under the mining tax, raising the pressure on Julia Gillard to admit the deal signed off with the three biggest miners in 2010 was botched.
The minor party, whose support is crucial to the Labor government's survival, wants to fix the underperforming Minerals Resource Rent Tax to fund schools, dental health, and disability insurance.
Armed with fresh data from the new Parliamentary Budget Office, it will build on its existing motion to plug the royalties hole with a second amendment limiting the scope of the biggest miners, such as BHP Billiton, Xstrata, and Rio Tinto, to deduct asset values from current earnings.
Along with other cross-benchers and the opposition, the Greens believe Ms Gillard and the Treasurer, Wayne Swan, were outmanoeuvred by the big three when cutting the new MRRT deal following the leadership change from Kevin Rudd.
The Greens say closing the loophole which allows state governments to lift royalty charges which must then be refunded by Canberra, would save more than $2.2 billion.
Its other change would close a further loophole which allows the big miners to write off the market value of existing assets over a number of years rather than deducting the lower book value over just five years.
It says this would secure more than $4 billion in revenue by 2016-17 and an extra $1.8 billion a year.
''Labor is taking more money off single parents than it has collected from the mining tax,'' the deputy leader, Adam Bandt, told Fairfax Media.
Its move comes as the failure of the tax, which raised just $126 million in its first six months, emerges as a potential flash-point for the Labor leadership.
MPs loyal to the Prime Minister are fuming at public criticism of the tax this week by Mr Rudd, the chief whip, Joel Fitzgibbon, and others.
Mr Rudd used a Sky News interview on Tuesday to remind colleagues that the original Resource Super Profits Tax had been stronger but had been replaced with the watered down MRRT by Ms Gillard and Mr Swan after the leadership change of mid-2010.
He said it was never right for governments to take a backward step when pursuing the national interest.
Amid the tension, an email from an ALP supporter to Mr Rudd on Wednesday was distributed widely among Labor MPs, reviving memories of the bitter personal campaign against the former prime minister's character last year.
''Mr Rudd, your disloyalty to your leader and party is shameful,'' wrote a retired school teacher, Sue Martin, of Avalon Beach.