“Far too little, far too late”. CICTAR‘s Jason Ward comments on Australian reform to fossil fuel taxation

Treasurer Jim Chalmers’ changes to taxes on offshore oil and gas projects will generate $3.5 billion extra revenue by 2050, nearly $13 billion less than another reform option identified in a report by Treasury.

Oil and gas projects captured by the Petroleum Resources Rent Tax (PRRT) pay just a fraction what producers do in other resources-rich countries, and Chalmers revealed on Saturday a change to the PRRT, imposing a cap of 90 per cent on the amount of income that offshore gas projects can offset.

Resources tax expert Jason Ward, from the Centre for International Corporate Tax Accountability and Research said the PRRT offered the world’s most generous tax regime for gas projects, with some companies expected to never pay any tax given the generous deductions offered by government for capital investment in project infrastructure.

He welcomed the changes to the PRRT but said it was “far too little, and far too late”.