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Today’s Top Headlines

Australia To Review Petroleum Resource Rent Tax

by Mary Swire,, Hong Kong

07 December 2016

The Australian Government has commissioned an independent review of the Petroleum Resource Rent Tax (PRRT), crude oil excise, and associated federal royalties.

The review will be led by an independent chairman, Michael Callaghan, with the support of the federal Treasury. The panel will report back to the Government by April 2017.

According to Treasurer Scott Morrison, the aim of the review is "to help better protect Australia's revenue base and ensure that companies are paying the right amount of tax on their activities in Australia."

The review will examine the design and operation of the PRRT, crude oil excise, and associated federal royalties that apply to the onshore and offshore oil and gas industry. It will advise the Government on the extent to which the PRRT operates as originally intended, and address the reasons for the recent decline in PRRT revenues.

The review will make recommendations to the Government on future tax and royalty arrangements, taking into account revenue adequacy, efficiency, equity, complexity, regulatory costs, and the impact on the industry generally.

Morrison said: "The integrity of Australia's tax base is paramount. This Government is committed to ensuring that Australia's taxes are working as intended and companies pay the right amount of tax."

"We will ensure that the PRRT provides an equitable return to the Australian community from the recovery of petroleum resources without discouraging investment in exploration and development that is vital to the industry."

TAGS: compliance | tax | investment | tax compliance | royalties | Australia | oil and gas | excise duty | ministry of finance | offshore | tax reform

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