The Australian government is not at fault on the latest mining tax row between federal authorities and giant resource firms, if Resources Minister Martin Ferguson was to be believed.

Ferguson said on Thursday that BHP Billiton, Rio Tinto and Xstrata were all barking up the wrong tree and should instead take their issues before the hosts states of their respective mining projects.

He stressed that the federal government remains committed to the deal it forged with mining firms just before the national elections on August yet he clarified that the proposed minerals resource rent tax clearly stipulates that state-based mining royalties would be credited back to the states.

The resources minister said that under the MRRT, the federal government is not committed to fully refund mining firms as he told ABC that "we made it very clear in may that we will recognise royalties at that date, in addition any that were scheduled."

Rio Tinto had testified before the Senate committee scrutinising new taxes that Prime Minister Julia Gillard appears to be backing away from her government's earlier agreement with Australia's major mining firms when she declared that she has reservations on spending millions of taxpayer's money to fund the reported tax credits claimed by BHP, Rio Tinto and Xstrata.

Rio Tinto reminded the Senate that its billion-dollar investment decisions this year were standing on the commitment tossed by Ms Gillard when she engaged the three mining firms into the negotiation table and won their approval on the proposed mining tax.

Ferguson, however, denied that the government is bent on reneging on its deal with the mining companies as he advised the three firms to raise their royalties concerns before state governments and treasuries, claiming that they are waging the wrong battle against the commonwealth.

Meanwhile, the federal opposition threw its support behind the claims of the three mining firms as opposition resources spokesman Ian MacFarlane scored Ms Gillard for backflipping on the agreement.

MacFarlane told ABC that the latest mining tax dispute only highlighted that "the dramatic conflict between the contents of the written document and the Gillard Government's new position on state royalties shows the entire basis of the MRRT is flawed."