The Conservation Council of WA (CCWA) has rebuked gas lobby claims the Petroleum Resource Rent Tax (PRRT) is providing a fair and just return to Australian taxpayers after decades of significant export profits.
The PRRT was introduced in 1987 and applies primarily to offshore projects, taxing profits after investors have recovered their exploration and development costs. It was amended in 2023, with the gas lobby working hard to water down any meaningful reforms.
CCWA Executive Director Matt Roberts supported the call for a 25% levy on gas export profits, saying it “would be a first step in getting a fairer deal for all Australians and funding the transition to a safer, cheaper renewable energy future.
“The gas industry isn't a charity taking big gambles offshore - it's a corporate industry making a huge amount of money,” Mr Roberts said.
“The gas lobby’s claims the PRRT is a ‘progressive’ tax is a nonsense. The tax is geared towards company returns and shareholder returns at the expense of the wider community, climate, and nature.
“The gas lobby has made a lot of claims and veiled threats about the impact of a flat 25% tax on export profits but has offered zero tangible evidence in support of these scare tactics,” Mr Roberts said.
“Research by The Australia Institute on the PRRT shows just how broken the tax is.
“While the PRRT is levied at 40% of a project’s PRRT taxable profit, deductions for capital expenditures increase in value each year. Cost blowouts increase the pool of deductions, and scheduled delays allow them to further escalate.
“2023/24 corporate tax data shows that Chevron and INPEX paid no PRRT, while reporting $19.4bn and $7.6b in income, respectively.
“In addition, a significant share of decommissioning costs for offshore oil and gas projects are effectively paid for by taxpayers under the PRRT rebates. Oil and gas companies can offset all decommissioning expenditure against its PRRT liability, therefore reducing tax payments.
“It’s well past time the gas industry paid for all the profits they’ve made from our resources. They’ll sling a lot of mud as this debate goes on, but the government needs to have the courage to represent the interests of Australians over the gas industry."
ENDS
Media contact: John Cooke – 0433 679 780