Thursday, June 23, 2022

Report exposes gas monopo-lies

Written by: John S on 24 June 2022 

Australians are victims of a massive fraudulent gas heist.

Gas prices are rising; gas is in short supply locally while massive amounts are exported. Gas multinationals are making huge, rapidly-increasing profits which are sent overseas, and these companies pay almost no Australian tax.

Australian Tax Office data bases revealed that the 5 biggest gas companies paid no tax in the past 7 years. Shell, for example has not paid tax since 2015.

The big 3 Queensland gas operators have paid no tax since 2015, except for Santos which made one payment of A$3 million.

Chevron told investors that it expected to never pay tax on its giant Gorgon gas project in WA.

Australia supposedly levies a 40% tax on gas and oil profits, but it is only collecting A$2.4b this year, the same as in 2005, and mainly on oil profits.

Taxes are based on profits discounted for past losses. Companies game the system by increasing costs and losses.

Chevron was found by the Federal Court to have evaded tax through a deliberate ploy. Its US parent company borrowed money at 2% and then lent that money to its Australian subsidiary at 9%. All Chevron profits left the country. Despite the court decision, Chevron has still paid no tax.

Across the big gas multinationals, loans from parent companies have more than doubled in the past 4 years (from $52b to $107b), ie loans to themselves.

They have paid no tax on revenue of $103b 

The oil and gas companies do have to pay royalties, which represent payment to the owners (ie the states) for extracting the resources that the states own. However, the rates are ridiculously low.

Five years ago, Treasury predicted that Australia expected to receive $800million in royalties for 100 million cubic metres of gas. Qatar predicted $26.6 billion for the same amount of gas.

These rorted profits go almost completely overseas.

Of the 10 largest gas projects, 3 are 100% foreign owned, and the other 7 are over 90% foreign-owned.

Only 4.3% of the gas extraction companies is Australian-owned.

Clearly, only nationalisation of the whole industry will enable the earnings to remain in Australia for our benefit, and enable its orderly phasing out in the necessary transition to renewable energy.

Further reading: See the Australia Institute’s full report, Foreign Investment in Australia: Australian big business is not Australian at all.

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