Coalition casts doubt over PRRT shake-up despite industry support

Angus Taylor says Coalition support for Labor’s PRRT crackdown is not guaranteed.

Opposition Treasury spokesman Angus Taylor. Picture: Monique Harmer / NCA Newswire

The Coalition is withholding support for Labor’s plan to strengthen the petroleum resource rent tax despite the ­nation’s peak gas lobby group saying bipartisanship was needed to ensure the sector had a “strong and sustainable future.”

The Greens on Monday said they would back the government’s PRRT shake-up only if the tax was tightened to raise an extra $5.6bn over the next decade, with the industry concerned Labor will be forced into negoti­ations with the minor party.

Australian Petroleum Production and Exploration Association chief executive Samantha McCulloch on Tuesday said Labor’s proposed PRRT changes provided “greater certainty for industry to consider the future investment required to maintain domestic and regional gas supply security for our customers.”

She ramped up pressure on the Coalition to come to the table, declaring “bipartisan support is important because Australia needs a strong and sustainable future for the gas industry and that requires stable and enduring policy settings”.

Opposition Treasury spokesman Angus Taylor said resources rent taxes were “very complex” and the Coalition would not sign a “blank cheque” to guarantee passage of the PRRT legislation through the parliament.

“This is Labor’s legislation. Not ours,” he said. “The detail matters. So we will be poring through that detail when we get it. But the fact of the matter is we don’t have it. We’re not going to sign a blank cheque here.”

The Greens position has raised concerns within the gas industry because it would effectively double the amount of revenue raised from Labor’s planned crackdown on LNG producers, with Jim Chalmers on Tuesday rejecting the ultimatum from the minor party.

“We intend to legislate the changes to the PRRT we announced in the budget,” the Treasurer said.

“They came after a considered methodical and long process, which landed on our three options from the Treasury.

“We chose the Treasury recommendation that provided the most return sooner when it comes to offshore LNG, and that’s the design, that’s the policy that we intend to legislate.”

Labor has proposed to tighten tax rules for LNG producers and accepted a proposal from Treasury to limit the proportion of PRRT assessable income that can be offset by deductions to 90 per cent. The budget forecast the change would raise an extra $2.4bn over five years.

The Greens want the cap to be set at 80 per cent, and say this position is also supported by a bloc of upper house crossbenchers, including independent senator David Pocock and Tas­manian senators Jacqui Lambie and Tammy Tyrrell.

A Parliamentary Budget Office costing of the Greens policy shows an 80 per cent cap would improve the budget bottom line by $2.6bn over forward estimates and $5.6bn over the decade.

The Greens are also blocking the passage of Labor’s $10bn housing package through the Senate, with Housing Minister Julie Collins to reintroduce the legislation on Wednesday in a move that sets up a double-­dissolution election trigger.

Anthony Albanese on Tuesday rejected the Greens position to increase revenue raised from the PRRT crackdown, saying Labor had put forward a “sensible position.”