A proposed tax increase on gas projects threatens industry and would drive up household costs, CCIWA has warned.
The caution comes as a federal parliamentary inquiry into Australia’s gas tax settings holds hearings in Perth today, amid calls for an additional 25% tax on oil and gas projects.
With global energy markets already under pressure due to the Middle East crisis, CCIWA said higher taxes risked undermining future gas supply stability.
See our submission to the inquiry
Investment certainty in focus
CCIWA Chief Economist Dr Daniel Kiely said Australia needed gas tax settings that delivered fairness, without deterring investment.
“Long-term energy projects need a stable economic and regulatory environment,” he said.
”Changing the rules mid-game undermines confidence in Australia’s investment landscape.”
Gas critical to WA industry
Kiely said any increase in costs would have far-reaching impacts across WA’s mining, manufacturing, chemicals and emerging clean energy industries.
“Gas underpins a significant number of processes across WA’s broad industrial sectors,” he said.
“Any additional cost through a tax hike would make Australia a less attractive place to invest, jeopardising investment in new gas projects and driving up costs for existing customers.
“Given the global energy crunch being caused by the Middle East conflict, Australia’s access to abundant and relatively affordable gas is more important than ever.”
Previous analysis by CCIWA highlighted the scale of the risk: a gas shortfall in WA would reduce economic output by $42 billion and cost up to 45,000 jobs.
Flow-on impacts for households
Gas also plays a critical role in maintaining a reliable electricity supply, particularly during peak demand such as heatwaves.
Kiely said additional taxes would inevitably flow through to households.
“A tax on gas exports is a tax on domestic energy,” he said.
“Gas is a fundamental part of WA’s energy grid, particularly for our manufacturing sector, and will continue to be vital for the energy transition away from coal.”
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