More money in the coffers: Australia studies increasing gas export revenue
The country, one of the world's main producers, collects more from the beer tax than from gas
SidneyIn Canberra, the rumor is that this year's budget – to be presented in May – is the most important of the century. Australian Prime Minister Anthony Albanese has gone from boasting about banning social media for under-16s to giving a televised speech about an economic shock that "will be with us for months." The war between the United States and Israel against Iran has caused, according to Goldman & Sachs, "the biggest disruption to energy supply in history." "We have seen the destruction of gas wells in Qatar and Iran," emphasizes Tony Wood, Energy researcher at the Grattan Institute, "if the conflict stops tomorrow, it will still take a long time to repair this infrastructure.
Meanwhile in Australia, multinationals like Santos or Woodside (the company that exports the most gas in the country and one of the most polluting companies) have seen their shares rise. A situation similar to 2022, when Russia invaded Ukraine. That year, Origin doubled its profits on a single pipeline. But despite rising prices, Australia does not expect to increase revenue. As Greg Jericho, chief economist at the Australian Institute, blogger and political analyst, explains, Australians are not getting a fair return for the gas extracted from their territory, as "57% of gas exports do not pay any royalty." Among the clients are South Korea, Taiwan, or Japan, who through Inpex, a company with state participation that "has not paid PRRT. They barely pay corporate tax, and they export so much gas to Japan at a competitive price that they can sell it to third countries in the Pacific and make profits. It seems that it is not Australian gas, but Japanese, at this point," explains Jericho.
Fifteen days ago, the public broadcaster ABC revealed that the prime minister had asked the Treasury to propose a reform to the PRRT (petroleum resource rent tax), as well as a possible tax on gas exports. "Energy companies should not benefit from high international prices at the expense of domestic consumers," stated the document written by Albanese's department. A move preceded by pressure from independent MPs from affluent electorates in Sydney and Melbourne, such as Allegra Spender and Monique Ryan, but which captured public attention when the government admitted it collected more from beer than from gas exports in response to a question from Senator David Pocock.
Despite being a known situation (the Treasury Department itself admitted it in 2016 stating that companies could postpone payment indefinitely), now the Laborites in the Senate have supported the creation of the Gas Resources Taxation Committee, chaired by a Greens senator and of which Pocock is a member, which is due to deliver its report on May 7. Just before the budget. Pocock proposes a 25% tax on exports, a measure that Samantha McCulloch, CEO of Australian Energy Producers, believes comes “at the worst possible time”. The head of the employers' association assured that investments would be lost due to “uncontrolled activism”.
However, according to the models of the Superpower Institute, Australia only collects 27% of the profits from fossil fuels, combining the PRRT and all taxes, far from countries like Norway or Qatar. For Ingrid Burfurd, a doctoral student in economics at the University of Melbourne, the crisis is an opportunity for reform: “If Australia had applied a tax, revenues would have increased by 1.1 billion Australian dollars since the beginning of the crisis in Iran”, she points out. “In 2025, the Petroleum Resource Rent Tax collected only 1.4 billion annually”.
According to the Australian Institute, a 25% tax would secure around 17 billion Australian dollars annually (10,184 million euros), enough to fund universities, or dentists in public healthcare, explains Jericho. “It is an empty threat, they will not leave, the gas is here. 25% will not ruin these companies”, he adds.
“There is no easier opportunity”
83% of Australia's liquefied gas is exported. At the same time, gas emissions when burned generate 1.1 billion tonnes of carbon dioxide, almost three times the state's domestic emissions, in a country where, as Marian Wilkinson reveals, Woodside has managed to get spies to work for its interests. But decades of inaction could be numbered. As Burfurd recalls, generations Y and Z will form the majority of voters in the 2028 federal elections and polls “show 68% support for the principle of making polluters pay for the damage they cause”. Pressured internally and externally, it seems Albanese could modify the tax regime for liquefied gas exports.
Jim Chalmers and Madeleine King, Treasurer and Resources Minister, have not closed the door and with each passing week more support falls away. Such as that of the CEO of one of the country's major banks, the Commonwealth Bank. “There are resources we are not valuing as a nation,” Matt Comyn stated at a conference where he made it clear that a tax between 15% and 25% would have a lot of support. “It's very strange that you have a good policy that is also so popular,” concludes Jericho, “it would be very foolish for the government to reject it”.