“We’ve said for some time now that we want to make sure that the PRRT arrangements are up to scratch,” he said,adding that the review had been commissioned by the former Coalition government.
“Clearly my predecessors had some concerns that they were not,and I have some concerns that they are not – the Australian community,I think,shares those concerns.”
The PRRT is levied on offshore oil or gas projects at a rate of 40 per cent of their taxable profit,but this is applied after generous deductions for capital investments,raising questions over the quantum of revenue it raised compared with the billions reaped in profits by gas giants including Woodside,Chevron and Santos.
LNG,one of Australia’s most valuable exports,is forecast to hit $91 billion in export earnings this financial year – three times more than in 2020-21 – as Russia’s invasion of Ukraine pushed fossil fuel prices to record highs.
‘Government is clearly reviewing options to increase tax revenues – and bring forward PRRT receipts – to help stem federal budget deficits.’
Macquarie analysts
The 2022-23 federal budget papers show the PRRT is expected to raise $2.6 billion this financial year,but will thereafter decline steadily over the next four years to about $2 billion by 2025-26.
Energy analysts at investment bank Macquarie on Monday told clients they expected PRRT reforms to be announced “around the May budget”.