Albanese government shelves gas export tax amid energy crisis

The Albanese government is abandoning its plans to introduce a hefty 25% tax on gas exports, effectively conceding to the powerful gas industry and sparking outrage from opposition figures.

Senator pocock accuses government of ‘caving’ to lobbying

Independent Senator David Pocock delivered a scathing rebuke, branding the decision as a capitulation to corporate interests and a betrayal of Australian taxpayers. He argues the government’s retreat ignores the urgent need for a return on Australia’s vast gas resources.

Following weeks of speculation and pressure, Treasury modelling reportedly indicated the proposed tax could generate upwards of $17 billion annually. However, citing the current global oil crisis and diplomatic efforts to secure liquefied natural gas supplies from Asian allies – spearheaded by Prime Minister Anthony Albanese – the government has opted to postpone any such levy in the upcoming budget.

Albanese defends energy strategy amid criticism

Prime Minister Albanese, while acknowledging the criticism, staunchly defended his administration's approach, emphasizing the critical importance of maintaining Australia’s energy security. He pointed to the significant $22 billion in taxes already paid by the oil and gas sector last year, a figure disputed by the Australian Energy Producers (AEP), which claims industry payments reached approximately $21.9 billion in 2024-25, including state royalties.

Despite the shelving of the export tax, Labor remains committed to pursuing gas industry reform. The government is reportedly considering alternative measures, such as adjustments to the Petroleum Resources Rent Tax and a windfall profits tax, though these remain subject to ongoing debate and potential modifications.

Industry claims investment justification

The AEP maintains that the substantial investment required to extract gas – estimated to be in the tens of billions of dollars – necessitates a fair assessment of industry revenue. Albanese, in a recent interview, highlighted this point, suggesting that the gas sector’s profitability shouldn’t be viewed as ‘free’.

Greens condemn ‘wartime profits’

The Greens have vehemently condemned the decision, accusing the government of prioritizing corporate profits over the needs of ordinary Australians, who are grappling with soaring energy costs. Larissa Waters labelled the move as “perverse,” arguing that the government is enabling gas companies to reap “obscene wartime profits” while struggling families face hardship.

Potential for increased jobseeker funding

Senator Pocock suggested that revenue generated from a gas export tax could be strategically deployed to bolster income support programs, specifically increasing Jobseeker payments to 90% of the age pension – a commitment already advocated for by the independent economic inclusion advisory committee. This would represent a significant investment in Australia's most vulnerable citizens.

Conclusion

The government’s strategic retreat from the gas export tax underscores a delicate balancing act between securing energy supplies, responding to global market pressures, and fulfilling domestic commitments. It’s a gamble, betting on Australia’s role as a reliable supplier to weather the current crisis, but one that risks leaving Australians feeling fleeced.