Anthony Albanese accused of ‘caving to gas companies’ as Labor set to reject new export tax | Australian politics

Labor is set to reject growing pressure for a new 25% tax on gas exports in next month’s budget, prompting David Pocock to accuse the government of “giving in” to the gas industry.

It is understood the government chose not to introduce a new tax on gas exports in the budget, partly because of the global oil crisis and Anthony Albanese’s diplomatic efforts to shore up fuel supplies to Asian allies by promising reliable access to liquefied natural gas.

The prime minister all but ruled out considering a public campaign calling for the new tax in interviews on Thursday. Trade Minister Don Farrell said Friday that “we are not changing our gas policy” and that “the most important thing” was to honor existing export contracts.

Less radical changes, including reforms to the oil rent tax or a windfall profits tax, have not yet been ruled out, and there is strong support within the Labor caucus for gas reforms.

But Pocock, the independent senator who is among those campaigning for a tax on gas exports, reacted angrily to revelations that the government was likely to reject the proposal.

“I am dismayed but not surprised to see the Albanian government giving in to the gas companies,” he said.

Guardian Australia reported on Wednesday that the export tax had been all but rejected. Albanese has not publicly ruled out changing the parameters of the gas tax, but expressed caution about the effects of any changes. In interviews published Thursday, Albanese claimed that gas companies paid $22 billion in taxes last year.

Pocock noted that a similar figure had been claimed by Australian Energy Producers, the oil and gas industry’s peak body, in an internal financial investigation – not in an official Department of Finance document. In its submission to the gas tax investigation, AEP said that investigation “estimates” that in the 2024-25 fiscal year, the oil and gas industry paid $21.9 billion in state taxes and fees, not just taxes.

“They’re paying about $22 billion and, more importantly, one of the things I said is you have to recognize the tens of billions of dollars of investment that are required to extract this gas,” Albanese told ABC on Thursday.

He would not confirm or deny whether a tax on gas exports remained under consideration, but added: “There have been some arguments that have been made, they have been a bit disingenuous, and those who are making them know that that is the case.”

Pocock said an additional tax was essential to deliver benefits to all Australians.

“We want a return on this resource, and yet we have a Prime Minister and others who are just presenting the arguments of the gas industry,” he said.

“I don’t think we should have a system where, just because you have an investment and you have huge capitalization rates on that investment, you get the gas for free…

“Who else in the economy gets their input for free? Builders pay for bricks. Bakers pay for flour. All hard-working traders have to buy their materials and then pay taxes. We give gas for free.”

Energy Minister Chris Bowen told Triple J on Thursday the government needed to strike a “balance” between gas exports and taxes, saying Australian gas was important both domestically and for our region.

Government sources say Albanese sought to “leverage” Australia’s status as a reliable gas supplier to ensure continued overseas oil supplies.

“Our gas exports are very important. Right now we are facing a fuel crisis where it is very important that countries in the region work together – whether it is fuel, liquid fuels, oil, diesel, gasoline or gas, we are all in this together,” Bowen said.

Farrell was asked if a 25% tax on gas exports was not being considered in the budget.

“I think the Treasurer and the Prime Minister remain quite clear. We are not changing our gas policy,” he said.

“The most important thing that Australia and the Australian government can do is ensure that the conditions are right for continued exports of our gas… Australia has an obligation, an agreement, to supply that gas.”

Greens leader Larissa Waters was scathing on Friday and said it would allow gas companies to “make obscene profits in wartime”.

“The Prime Minister has a choice in this budget: deliver results for greedy gas companies, or deliver results for the people,” Waters said. “If he chose the wrong side today, that will be his legacy.”

The government is under increasing pressure from unions and Labor MPs to introduce a flat 25% tax on gas exports, which the Australia Institute think tank estimates could raise $17 billion a year.

But despite revelations last month that the Treasury had been asked to model a windfall profits tax and changes to the oil resource rent tax, the appetite for major interventions appears to have diminished amid the global energy crisis.

Asked during a trip to Singapore about the prospect of a new gasoline tax, Albanese said the government’s priority on energy was “supply, supply, supply.”

On Friday, the government published the report of the independent advisory committee on economic inclusion, which calls for an increase in the old age pension for jobseekers to 90%. Pocock said a tax on gas exports could more than cover the increase.

“Increase income support to 75% of the old age pension [in the first year]that the Committee recommended, would cost just $1.6 billion and would ensure that children from these households have a chance of one day becoming Prime Minister,” Pocock said.

The commission has recommended an increase in the number of jobseekers over the past three years, but has been ignored by the government. The payment is not expected to be increased in this year’s budget.