Ripped off? Despite being one of the largest gas exporters in the world, Australians have missed out on billions of dollars due to limp-wristed taxes on gas exports.
According to the Australia Institute, we'd be about $69 billion richer if there had been a 25% tax on gas exports introduced in July 2022.
This money could’ve paid for free university or free childcare in the same time period.
A 25% tax on gas exports works out to $348.9 million in revenue a week, or $17 billion a year.
Investigation: The Federal Government has supported the establishment of a Senate inquiry into gas taxes, chaired by Greens Senator Steph Hodgins-May.
The panel involves senators from across the political spectrum, like independent Senator David Pocock, Liberal Susan McDonald and Labor’s Varun Ghosh, and will interview experts as well as industry and community groups to gather evidence and make recommendations to the Government.
These recommendations are due just days before the Federal Budget on May 12.
Compelled: Among the people who have been summoned to the inquiry are the CEOs of fossil fuel giants Santos, Woodside, Chevron and Shell.
Under Australian law, people who have been requested to give evidence at an inquiry have to attend. Failing to do so would be contempt of the senate, punishable by fines or prison time.
Squirming: Senator Steph Hodgins-May told the National Account this will be an opportunity to put the gas companies under the microscope:
🗣️ “I think the public genuinely do want to hear from these multinational corporations who are set to make record profits off the back of this illegal war that's happening in the Middle East,” she said.
Hodgins-May said companies should be forced to reveal what they’re planning to do with those profits and “why they think they should continue to write the rules of our tax system rather than play by the rules that every other Australian is forced to play.”
Why should you care? Besides the fact the extra money raised could be used to improve the services Australians use every day, Hodgins-May said the average Australian isn’t seeing the rewards for this gas being exported:
🗣️ “We want to see this money flowing back into the pockets of Australians. Our modelling shows that from January to April this year, every Australian would be $400 better off if we taxed gas properly.”
Will they listen? It’s likely the inquiry will provide even more of an excuse to push ahead with introducing a 25% tax on gas exports in the upcoming federal budget.
However, despite broad support across voters of all persuasions, there appears to still be doubt among some cabinet ministers, like Resources Minister Catherine King.
According to the AFR, King has echoed concerns from gas giants the tax could harm industry investment. Hodgins-May said they’re ready to hear those arguments.
🗣️“This is a modest contribution that they should be paying for our gas that they're exporting,” she said. “It's certainly not going to wipe out their bottom line. They're still making far too much money.”
Repercussions: Senator Hodgins-May said if the government were to ignore the calls for a tax, or shelve the Senate report when it’s released, there could be serious consequences for Labor when it comes to passing laws in the senate.
When asked if the Greens could hold up legislation passing, the Senator replied: “negotiations happen every week in that place and, if we're not taxing our resources properly, then that is an option open to us.”
Watch the full interview below:
Thumbnail: Kevin Gallagher, Managing Director and Chief Executive Officer of Santos - Reuters