How ordinary Australians are being FLEECED by major oil companies who pay virtually nothing in tax – as you face higher bills while they rake in BILLIONS
- Five energy giants paid no tax over past seven years despite $138billion profit
- Report found Chevron and ExxonMobil among companies avoiding taxation
- Experts say the behaviour is ‘illegal’ and ATO should clamp down on abuse
Five energy giants have paid no income tax over the past seven years despite generating a combined $138 billion in profit – while millions of Australians are hit with skyrocketing energy bills.
A startling report from the Australia Institute found four of the five members of the Australian Petroleum Production and Exploration Association (APPEA) – which includes some of the world’s biggest firms – are paying no tax despite massive income.
Chevron, ExxonMobil, Arrow Energy and Australia-Pacific LNG are ‘violating laws’ in avoiding taxation according to experts, with the greed of the multinational companies laid bare.
‘If we look at the gas cartel on the east coast of Australia, two of its multinational members – Shell and Exxon – pay no income tax on over $20 billion worth of revenues,’ energy finance analyst Bruce Robertson told The Project.
‘On the royalties side, the companies pay very little royalties onshore, and in many cases no royalties at all offshore. So we are giving away our gas for free.’
Five energy giants have paid no income tax over the past seven years despite generating a combined $138 billion in profit
The APPEA estimated the members of the association would pay roughly $11billion in tax by 2020 – saying the gas and oil exploration would bring significant revenue to Australia.
Instead, the energy giants have paid no money in tax – while Australian venture Santos paid just $6million income tax from $28.9billion.
Host Waleed Aly asked Mr Robertson which loopholes the companies were exploiting, assuming there had been no legal fouplay – something the expert objected to.
‘All of which is perfectly legal from what I gather? No-one is claiming that this is a rort of some description, or it somehow violates laws, so what would have to change?’ Aly asked.
‘Well, some people are claiming it is a rort and it does violate laws and one of those people would be the Australian Tax Office and myself to back them up,’ Mr Roberston responded with a smile.
Energy finance analyst Bruce Robertson said the companies are committing ‘illegal’ behaviour and the ATO and federal government should clamp down on their abuse
‘If you have a look, the ATO reached a settlement with Chevron in 2018 that involved nearly $1 billion worth of tax being paid and at the moment Exxon Mobil is shortly going to make a settlement with the ATO.
Gemina, the gas pipeline company, owned by the government of Singapore and the government of China, it is currently under investigation for transfer pricing on its convertible nodes. So there is illegality going on.’
Mr Robertson called for the ATO to be given more power to prosecute and bigger fines handed out to major companies abusing Australia’s tax system.
He suggested all of the gas and oil powers were committing ‘illegal taxation practices’.
Former prime minister Scott Morrison opened the APPEA conference in Brisbane on Tuesday.
Energy giants’ Australian tax rort
- In a 2012 APPEA claimed Queensland coal seam gas LNG companies would have paid around $11.2 billion in federal income tax by 2020. They have paid almost none.
- In 2015 Chevron estimated it would have paid around $4 billion in ‘direct taxations and royalties’ by 2020. It has paid no income tax or resource tax over that period.
- In 2013 Shell claimed that its Prelude floating LNG project would pay $12 billion in taxes over the life of the project. Shell has since acknowledged it will never pay PRRT has paid no income tax since 2015.
- An eighth company, Australian company Santos, paid just $6 million income tax on $28.9 billion of income, and paid no income tax from 2015 to 2018 and 2020.
Source: Australian Institute
Mark Ogge, the principal adviser at the Australian Institute, lamented Morrison’s federal government ‘giving the resource away for free’ to these multi-national companies and said the industry needed a complete overhaul.
‘It’s unbelievable that you can make $138 billion and pay nothing in tax. Our governments should not be letting this happen and we need an overhaul of how the oil and gas industry is taxed in Australia,’ he said.
‘The gas companies promised us billions in revenue and instead we end up with little in our pockets and a whole lot more climate impacts.
‘We trust our politicians to tax our natural resources to the benefit of all Australians, but instead some of the largest gas miners, members of APPEA, are paying absolutely nothing.
‘The federal government is virtually giving the resource away for free, gift wrapped in subsidies, mostly to foreign-owned companies, many of whom pay little if any tax.’
Mr Ogge called for Anthony Albanese to impose ‘far greater scrutiny’ on the giants who are forcing massive price hikes on customers despite paying no tax.
‘Imagine if you trusted an agent to sell your house to get the best deal possible, but instead they gave it to their mate for next to nothing. This is what is happening with our gas resources,’ he said.
‘Far greater scrutiny should be given to the close ties between some of our political representatives and the oil and gas companies who benefit from their largesse with our money.’