Workers’ Union wants UK-style gas profits tax

Ship with LNG gas exports (UK gas)
Image: Shutterstock

The Australian Workers’ Union is advising the federal government to urgently put a UK-style windfall tax on the table to force multinational gas exporters to give Australian manufacturers access to affordable Australia gas.

The AWU has long called for a domestic gas reservation scheme, warning for a decade that allowing multinational gas companies to export Australia’s gas without restriction would lead to a domestic price explosion that would force manufacturing operations to close and lead to thousands of job losses.

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However, with the emergency now hitting and factory closures imminent, AWU National Secretary Daniel Walton said the government needed to follow the UK’s example and prepare to implement a windfall tax on mega-profits unless affordable gas is made available to Australians.

“Right now multinational gas exporters are using the global situation to cream astronomical mega-profits from Australian gas while forcing Australian factories, smelters and plants to the wall,” Walton said.

“I’ve had manufacturers telling me they are seeing their gas costs rise by as much $100,000 a day. It’s insane and it’s unsustainable. Without drastic action we’re going to see thousands of Australian manufacturing jobs lost this year.

“The government should tell the gas exporters it’s fine for them to generate record profits, but they also have to ensure some of those mega-profits are used to help the nation that owns the gas. At every stage in discussions the government should be holding a big stick with ‘windfall tax’ written on it.

“I know the federal government is engaging with the gas exporters but history tells us that you just can’t trust them. They will always have some excuse for why they can’t make some of the gas they extract available to Australians at a fair price. And they will always find a way to wiggle out of handshake agreements.

“The government’s offer to exporters needs to be fair and simple: make affordable gas available to Australian manufacturers now or face a UK-style windfall tax and we will distribute the revenue ourselves.

“If the government refuse to pick up that stick now and get tough then gas exporters will bluster and delay and factories will close en masse.”

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Last month, Britain’s Conservative government announced a 25 per cent windfall tax on the profits of gas firms to support low-income households struggling with a sharp spike in prices.

Chancellor Rishi Sunak observed the tax was fair and reasonable because the mega profits did not arise because of “changes to risk-taking, innovation or efficiency… for that reason, I am sympathetic to the argument to tax those profits fairly.”

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