Australia Urged To Scrap 'Wasteful' Oil Tax Breaks

by Mary Swire, Tax-News.com, Hong Kong

30 January 2012

The Australian Conservation Foundation (ACF) has argued that the Federal Government could save up AUD2.3bn in the 2012-13 Budget by scrapping wasteful and inefficient tax breaks to the oil and gas sector as well as other subsidies that promote the use of fossil fuels.

The ACF identified savings that can be made by repealing wasteful subsidies in its budget submission to the government. It is argued that these subsidies encourage pollution and the ACF has therefore urged the government to invest in protecting the oceans around Australia instead.

The ACF believes that Australia has not done enough to honour its commitment to “phase out and rationalize over the medium-term inefficient fossil fuel subsidies” as pledged when they joined the G20.

“The oil and gas industry’s environmental record has been severely tarnished in recent years by the Montara and Deepwater Horizon oil spills and by promoting inappropriate industrial developments in sensitive areas,” Australian Conservation Foundation CEO Don Henry said.

“If the government redirected just 15%, or AUD500 million, of the direct tax breaks that are set to flow to big oil and gas companies over the next five years, it would be enough to complete the establishment of a world class network of marine reserves and good management for healthier oceans around our island," Henry added.

The ACF believes that the oil and gas industry have enough protection, whereas the oceans are in urgent need of care. They hope that their submission will make the government redress the imbalance.

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