Petroleum Resource Rent Tax architect says deductions could be 'too generous'

AUSTRALIAN FINANCIAL REVIEW
Joanne Mather
1 December 2016

Australia should not make retrospective changes to tax rules for oil and gas companies that have already invested here, former Labor minister and Petroleum Resource Rent Tax architect Craig Emerson says.

But he backed the government's PRRT review, noting that the original deductions for exploratory activities could be "too generous" and concessions granted by the Howard government in the mid-2000s may have undermined the regime's integrity.

The International Transport Federation and Tax Justice Network, a loose affiliation of church, union and social justice groups, have been agitating for a parliamentary inquiry into the PRRT.

ITF researcher Jason Ward claims that had the effective PRRT tax rate remained at 24.2 per cent of petroleum sales, as it was in 2003-04, Australia would collect $480 billion, or $2.4 billion a year, during the next 20 years.

But the official budget prediction for the next four years is $800 million per annum.

> Read more: http://www.afr.com/news/politics/petroleum-resource-resource-tax-architect-says-deductions-could-be-too-generous-20161130-gt1fkk