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Environment; natural resources

- eg, carbon tax; taxes on fuel and vehicles; resource rent taxes; congestion charges

- see also Fringe benefits; Land

The petroleum resource rent tax: overview of primary documents and literature leading to the 1987 legislation

Kraal D, Tax and Transfer Policy Institute (October 2016). Newly available archival documents give insight into the Hawke Government (1983-1991) political and consultative processes, which resulted in the Australia’s Petroleum Resource Rent Tax Assessment Act 1987 (Cth). The recently unpacked private papers from 1984 of Dr Craig Emerson (a Ministerial economic advisor at the time of petroleum tax reform) provide a unique perspective into the consultative process via hand-written files, draft reports with annotations, and personal observations. Further, relevant files from the National Archives of Australia reveal the government’s petroleum tax reform discussion papers, media statements, industry responses to the tax, comparative tax modelling and the records of consultative meetings from 1984. This paper draws on these new files to provide a brief narrative and identify the dominant stakeholders in the route to petroleum tax reform for a later more detailed enquiry by the author into the roles of key persons in the progression of resource policy to legislation.


Effective carbon rates on energy

OECD (December 2015). 


Taxing carbon and recycling the revenue: who wins and loses

Donald Marron, Eric Toder and Lydia Austin, Urban Brookings Tax Policy Center (November 2015). This Tax Fact explores the distributional impact of taxing carbon dioxide to combat climate change and in recycling the revenues into tax cuts.


Mining Subsidies vs Public Services

The Australia Institute (September 2015). As new Resources and Energy Minister Josh Frydenberg announces that the $5 billion Northern Australia fund could be used to subsidise coal projects, including the Adani mine in the Galilee, research shows support ranging from 65% to 78% for a policy shift.
According to a series of polls, commissioned by The Australia Institute as part of its ongoing research, removing subsidies for the fossil fuel and mining industries and redirecting those funds into services for people is immensely popular in Australia.


Impacts of Carbon Prices on Indicators of Competitiveness

Johanna Arlinghaus, OECD (March 2015). Concerns around potential losses of competitiveness as a result of unilateral action on carbon pricing are often central for policy makers contemplating the introduction of such instruments. This paper is a review of literature on ex post empirical evaluations of the impacts of carbon prices on indicators of competitiveness as employed in the literature, including employment, output or exports, at different levels of aggregation.


Get Regular Excise: The case to reindex the fuel excise

The Australia Institute (June 2015). The Howard Government decision in 2001 to cut indexation has cost the budget more than $46 billion in tax revenue to date. If no change is made the total cost to the budget is projected to top $160 billion by 2025. Additional carbon dioxide emissions attributable to the policy are projected to reach 16 million tonnes by 2025.
A report released today from The Australia Institute also provided a breakdown of impact on lower income Australians.


Taxing Carbon What, Why and How

Donald Marron, Eric Toder, Lydia Austin, Urban Brookings Tax Policy Center (June 2015). The case for a carbon tax is strong. A well-designed tax could efficiently reduce the emissions that cause climate change and encourage innovation in cleaner technologies. The resulting revenue could finance tax reductions, spending priorities, or deficit reduction—policies that could offset the tax’s distributional and economic burdens, improve the environment, or otherwise improve Americans’ well-being. But moving a carbon tax from the whiteboard to reality is challenging. To help policymakers, analysts, and the public address those challenges, this report examines the what, why, and how of implementing a carbon tax and using the revenue it would generate.


Powers of deduction: Tax deductions, environmental organisations and the mining industry

Rod Campbell, Matt Grudnoff, Dave Richardson, Tom Swann, Cam Amos and Molly Johnson, The Australia Institute (June 2015). Donations to environment organisations in Australia are tax deductible as long as the organisation in question is listed on the Commonwealth Register of Environmental Organisations. This listing gives an organisation Deductible Gift Recipient (DGR) status. A parliamentary inquiry is looking into the Register, largely at the behest of the mining industry.


Mining industry demands exclusive rights to tax deductions

Rod Campbell, The Australia Institute (June 2015). The mining industry has convinced the Federal Government to hold an inquiry into the tax deductible gift status of environmental organisations who oppose mining projects.


Subsidies ate the boom

Richard Denniss, The Australia Institute (April 2015). The iron ore price is well above its long-term average. Indeed, at $US50 per tonne it is well above the $US36 price that Wayne Swan inherited in 2007. Blaming the iron ore price for Western Australia’s budgetary woes is like blaming the sinking of the Titanic on the iceberg. Yes, it’s a factor and yes, it’s a problem but it’s easily avoided with a little bit of preparation.


Leyonhjelm’s plan for a State Government electricity tax

The Australia Institute (November 2014).  Liberal Democrats Senator for NSW, David Leyonhelm, is proposing that existing hydro electricity generators that are built before the RET become eligible for Renewable Energy Certificates (RECs).


Tax Preferences for Environmental Goals

James Greene, Nils A. Braathen (October 2014). This paper reviews the use of tax preferences to achieve environmental policy objectives. Tax preferences involve using the tax system to adjust relative prices with a view to influencing producer or consumer behaviour in favour of goods or services that are considered to be environmentally beneficial. They take various forms, typically a partial or total excemption from a specified tax. Because tax preferences help to avoid or reduce costs for businesses or consumers, there are often pressures on governments to favour them over other instruments. As a result, they are sometimes used inappropriately, typically to address negative externalities for which they are not well suited. The paper suggests that the comparative advantage of tax preferences is in providing support for positive externalities, that is situations in which a subsidy would help to deliver more social benefits than would otherwise be the case. When designing tax preferences, care must be taken to ensure that they do not encourage technological lock-in, provide perverse incentives for environmentally harmful activities (the rebound effect), or reward producers or consumers for actions they would have taken anyway. Since tax preferences are a form of subsidy, they should be subject to the same degree of scrutiny and oversight as other forms of public expenditure.


OECD Taxing the Rent of Non-Renewable Resources

OECD (July 2014). This study analyses the economic rent generated by the exploitation of a non-renewable resource, and the taxation of this rent. The OECD presents a synthetic model of a non-renewable-resource sector where deposits must be costly developed before they are exploited; the analysis emphasises the effect of resource taxation on the discouragement to the development of new reserves. The paper discusses the limitations of neutral profit-taxation schemes and examines the distortions caused by various resource-taxation systems on the rent and its allocation: tax evasion, royalty-induced distortions, imperfect tax commitment, agency issues… The paper also discusses the measurement of resource rents for taxation purposes, and issues with the management of the resource tax income


Carbon Policy Sinks to Symbolism

The Australia Institute (July 2014). Just as introducing the carbon tax didn’t really drive the cost of a leg of lamb to $100, removing it isn’t really going to have any noticeable impact on the cost of living.
Supermarkets are adamant they didn’t increase prices when the carbon price came in, and they are just as adamant they won’t cut prices when it is scrapped.
In rich countries with strong economies, politics revolves around symbolic issues. Asylum seekers account for a tiny fraction of our rapid population growth but are the focus of all our debate about population.
Our public debt is tiny, but the political furore around it prevents meaningful debate about the kind of infrastructure and human capital we should invest in. The carbon price was never really a “wrecking ball” through the economy, but the polemic around it prevented meaningful debate about shifting the burden of tax away from labour and towards pollution.
If not repealed, the carbon price introduced by Labor is set to fall from $25.40 today to about $8 next June, when the fixed-price period ends and the floating-price period begins.


Mining the Age of Entitlement

The Australia Institute (June 2014). State governments are more usually associated with the provision of health, education and law enforcement than industry assistance. So it might surprise taxpayers to learn that state government assistance for the mineral and fossil fuel industries consumes significant amounts of their money.
Each state provides millions of dollars’ worth of assistance to mining industries every year, with the big mining states of Queensland and Western Australia routinely spending over one billion dollars in assistance.
This paper is the first attempt to put a dollar figure on the value of state assistance to the mining industry. It shows that over a six-year period, state governments in Australia spent $17.6 billion supporting the mineral and fossil fuel industries. Queensland’s assistance was by far the largest of all states, totalling $9.5 billion, followed by Western Australia’s at $6.2 billion.
State government assistance to the mineral and fossil fuel industries appears substantial even when compared to big budget items, such as health, education and law and order. For example, Queensland’s expenditure on these industries in 2013-14 is similar to the amount to be spent on disability services and capital expenditure on hospitals. Queensland will spend as much on supporting the mining industry as it does on supporting some of its most vulnerable citizens. Similarly, industry assistance in Western Australia is substantial when compared to police and health, and in New South Wales, it is comparable to other important budget items such as managing the state’s national parks and providing accommodation for those with disabilities.
Supporters of Australia’s mineral and fossil fuel industries are quick to argue that royalties paid to state governments demonstrate those industries’ value and importance. Rarely, however, are these contributions compared with industry assistance. State expenditure on industry assistance makes up a significant proportion of what states receive through royalties, particularly in the big mining states of Queensland and Western Australia. In 2013- 14 Queensland is planning on spending $1.5 billion on industry assistance, almost 60 per cent of what it will receive in royalties.
Mining the state budgets for details on state subsidies to the mineral and fossil fuels industy was a lengthy process. It is not surprising, then, that the scale of state subsidies to some of Australia’s biggest, most profitable industries has thus far remained unearthed. This paper details the value of state revenue that would otherwise have been available for increased vital public services – for example, more teachers, nurses and police.


Tax Policy Issues in Designing a Carbon Tax

Donald B. Marron and Eric J. Toder (May 2014). A carbon tax is a promising tool for discouraging the greenhouse gas emissions that cause climate change. In principle, a well-designed tax could reduce the risk of climate change, minimise the cost of emissions reductions, encourage innovation in low-carbon technologies, and raise new public revenue. But designing a real-world carbon tax poses significant challenges. This paper analyses those challenges from a public finance perspective, emphasising three tax policy design issues: setting the tax rate, collecting the tax, and using the resulting revenue. The benefits of a carbon tax will depend on how policymakers address those issues.


Forestry Aid Ignores Real Problems

Dr Richard Denniss, Australia Institute (March 2014).


Who WINS and who LOSES from the Mining Tax repeal?

Australia Institute (February 2014). Poster – the MRRT should not be abolished.


ACOSS Submission – Inquiry into the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and Related Bills

Australian Council of Social Service (November 2013). This brief submission addresses the following:
1. Why climate change policy and action is particularly relevant to the lives of people who experience poverty and disadvantage;
2. Our position on action to address climate change and Australian policy;
3. Our understanding of the drivers of energy prices in the Australian energy market and the importance of energy efficiency for low-income households;
4. Our concern to ensure that people on low incomes are not adversely affected by savings measures required by the repeal of the carbon price or the transition to ‘direct action’ policies.


ACOSS Submission to Economics Committee Inquiry into MRRT Repeal Legislation

Australian Council of Social Service (November 2013). This brief submission outlines ACOSS’ general position on the MRRT and expresses ACOSS’ opposition to the abolition of measures which directly benefit low income people, including the Low Income Superannuation Contribution, the Income Support Bonus and the School Kids Bonus in the absence of alternative measures to support low income households.


The MRRT Should Not Be Abolished – Submission to the Senate Inquiry into Minerals Resource Rent Tax Repeal and Other Measures Bill 2013

David Richardson and Richard Denniss, The Australia Institute (November 2013). The direction of the present set of changes greatly advantages a small number of large companies including some foreign-owned corporations worth hundreds of billions of dollars. To fund the repeal of the MRRT with the consequential measures mentioned below will hurt millions of households, up to 10 million workers and hundreds of thousands of small businesses.


Energy Use Policies and Carbon Pricing in the UK
Institute for Fiscal Studies (November 2013). Energy policy in the UK has many objectives to ensure cheap and reliable supply, to avoid fuel poverty, to reduce carbon emissions and other pollutants and to raise revenue. Some of these objectives have been  formalised in explicit statutory targets on fuel poverty, renewable energy and greenhouse gas (GHG) emissions. Over the years, public policymakers have put in place an array of measures to achieve these objectives – the report identifies over 20 policy interventions aimed at, or felt directly by, energy users. There are many more that fall outside the scope of this report, including regulatory arrangements, which determine how competition in this sector works, and other policies which concern energy producers only. This has made UK energy use policy very complex and in places inefficient and inconsistent. The aim of this report is to analyse and assess the policy landscape faced by UK energy users – both households and firms – and explore the potential for improvement. The report highlights a number of reform options and recommendations for firm and household energy use policies. They include some changes that could be implemented quickly and more radical reforms that would require further consultation and time.


The Carbon Windfall ‘Game’: Impact of a Mid-year CPM Repeal 
Reputex (October 2013).  A mid-year repeal of the Australian CPM may lead to a windfall of A$2bn for the Metals, Energy, Materials and Power sectors, with potential for entities to ‘game’ assistance programs via the CERs legislated buy-back facility. In this update we explore scenarios for the Q1 FY15 repeal of the CPM, and the cost/windfall of cashing in free permits, along with scenarios for government to mitigate any liability via the provision of future credits into a re-worked Direct Action Plan.


Abbott Destroys Carbon Symbol But Emmissions Issue Remains

The carbon price has become the ultimate political symbol. But has this helped or harmed the cause for those who support it?

For many progressives this symbol was so potent that they ran a “say yes” campaign for it even before they knew what it would entail.

Regardless of the emission reduction targets or the generosity of the compensation package enshrined in the final legislation, supporters of the symbol of carbon pricing were just happy to see their team win the day.

But what if the carbon price was nothing more than an economic instrument with some capacity to help reduce greenhouse gas emissions?

Dr Richard Denniss, The Australia Institute (September 2013).


Carbon pricing and reducing Australia’s emissions
Professor Ross Garnaut (17 Mar 2011).  Describes a range of taxation provisions in OECD countries, such as the taxation of motor vehicles, tobacco and alcoholic beverages and presents trends for 2010.


Transitional assistance or windfall profits? The financial impact of the carbon price and compensation payments on Victoria’s brown coal generators
Environment Victoria (February 2013).  This report presents analysis of the impact of the carbon price package legislated in Australia’s Clean Energy Act 2011 on the profitability of Victoria’s brown coal generators. The context to this report is our client’s interest in obtaining a deeper understanding of the extent to which carbon price ‘compensation’ payments through the Energy Security Fund may deliver “windfall” profits to the Victorian generators that are eligible to receive payments from this fund.


Someone’s Silver Lining
Richard Denniss, The Australia Institute (July 2013).  Prime Minister Kevin Rudd’s announcement that the carbon price is now a quarter of what was forecast is good news; the question is, for whom? Rather than crippling, the impact of the carbon price is barely even irritating for most polluters. Compared with the impact of the high exchange rate since 2007, the carbon price was trivial even before this week’s announcement.


Taxation of Native Title and Traditional Owner Benefits and Governance Working Group Report to Government
Australian Government Treasury (July 2013)

The Taxation of Native Title and Traditional Owner Benefits and Governance Working Group was established to examine existing arrangements for holding, managing and distributing land related payments, and to identify options to strengthen governance and promote sustainability. Its particular focus was on the tax treatment of current arrangements and of proposed options for holding, managing and distributing land related payments.


Someone's Silver Lining
Richard Denniss, The Australia Institute (July 2013)

Prime Minister Kevin Rudd's announcement that the carbon price is now a quarter of what was forecast is good news; the question is, for whom? Rather than crippling, the impact of the carbon price is barely even irritating for most polluters. Compared with the impact of the high exchange rate since 2007, the carbon price was trivial even before this week's announcement.


An Evidence-Based Approach to Pricing CO2 Emissions
Ross McKitrick, The Global Warming Policy Foundation (July 2013)

Ross McKitrick proposes a radical new climate policy approach that offers to be the most cost-effective means of curbing CO2 emissions, while automatically adjusting the stringency of the policy to the severity of the problem.


Energy Subsidy Reform: Lessons and Implications
International Monetary Fund (January 2013)

This paper argues for fewer energy subsidies.


Transitional assistance or windfall profits? The financial impact of the carbon price and compensation payments on Victoria's brown coal generators
Environment Victoria (February 2013)

This report presents analysis of the impact of the carbon price package legislated in Australia’s Clean Energy Act 2011 on the profitability of Victoria’s brown coal generators. The context to this report is our client’s interest in obtaining a deeper understanding of the extent to which carbon price #39œcompensation’ payments through the Energy Security Fund may deliver ‘windfall’ profits to the Victorian generators that are eligible to receive payments from this fund.


Inventory of Estimated Budgetary Support and Tax Expenditures for Fossil Fuels 2013
OECD (January 2013)

This Inventory is concerned with direct budgetary transfers and tax expenditures that relate to fossil fuels, regardless of their impact or of the purpose for which the measures were first put in place. It has been undertaken as an exercise in transparency, and to inform the international dialogue on fossil-fuel subsidy reform. For each of the 34 OECD countries covered, the Inventory provides a succinct summary of its energy economy, and of the budgetary and tax-related measures provided at the central-government level (and, in the case of federal countries, for selected sub-national units of government) relating to fossil-fuel production or consumption.


After the Party – How Australia spend its mining boom windfall
David Hetherington & Dominic Prior (2012)


Community and Public Sector Union Statement of Reform Priorities
Nadine Flood (September 2011)

Community and Public Sector Union’s statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.


Australian Council of Trade Unions Statement of Reform Priorities
Jeff Lawrence (September 2011)

Australian Council of Trade Unions’ statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.


Australian Council of Social Services Statement of Reform Priorities
Dr Cassandra Goldie and Peter Davidson (September 2011)

Australian Council of Social Services statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.


Australian Conservation Foundation Statement of Reform Priorities

Australian Conservation Foundation statement of taxation reform priorities in preparation to the Tax Forum 4-5 October 2011.


New Protectionism Under Carbon Pricing: Case Studies of LNG, Coal Mining and Steel Sectors
Tony Wood and Tristan Edis (6 September 2011)

The Government’s unduly generous assistance to industry under its carbon emissions package may create a new protectionism. The whole community will pay for unjustified subsidies to the LNG and coal industries.


ClimateWorks Australia: Impact of the Carbon Price Package
ClimateWorks Australia (12 August 2011)

A report that analyses the impact the carbon price package will impact investor profitability, how it reduces non-financial barriers, and what remains to be done.


National Tax Forum discussion paper
Australian Government (28 July 2011)

Discussion paper released by the Australian Government in the leadup to the National Tax Forum in October 2011, particularly dealing with the six sessions to be included at the forum: Personal tax, transfer payments, business tax, state taxes, environmental and social taxes, and tax system governance.


Senate Committee report on reform of car FBT rules
Australian Government Senate Economics Committee (22 June 2011)

A report on the provisions of Tax Laws Amendment (2011 Measures No. 5) Bill 2011 proposing to reform the car fringe benefits tax (FBT) rules, tabled in the Senate. The report includes issues relating to the new FBT rules raised by stakeholders during the inquiry process.


Tax treaty issues related to the trading of emissions permits (discussion draft)
OECD (31 May 2011)

The OECD Committee on Fiscal Affairs (CFA) has released a preliminary analysis of the tax treaty issues related to the trading of emissions permits for public comment. This analysis addresses the application of the provisions of the OECD Model Tax Convention to the cross-border trading of emissions permits.


OECD Tax Agenda 2011 – environmental taxes
OECD (12 Apr 2011)

An excerpt from the OECD’s latest Tax Agenda brochure, outlining its current work in a variety of tax-related areas, including: Green Growth and Climate Change – Taxation and Tradable Permits.


Congestion charging for roads: local pressures and international experience
John Daley, Grattan Institute (31 Jan 2011)

A presentation by John Daley, CEO of the Grattan Institute to the Roads Australia Pricing Forum, about the basis for a congestion tax, the benefits it could bring and the challenges faced in implementing it.


Complementary or contradictory? An analysis of the design of climate policies in Australia
The Australia Institute (Feb 2011)

Contrary to popular belief, the policies that are most effective in driving down greenhouse gas emissions actually raise revenue rather than cost the budget money. This paper outlines the circumstances in which such complementary policies are required and then assesses whether the recent decision to modify and abolish a wide range of these complementary policies was justified.


Tax Breaks for Green Buildings (Consultation paper)
Australian Government (Jan 2011)

A cpublic onsultation paper on tax breaks for redevelopments that will substantially improve the energy efficiency of existing buildings. The consultation paper explains the key features of the proposed program design, in particular, the eligibility criteria and assessment and certification processes.


MRRT Policy Transition Group Report
Australian Government (Dec 2010)

The Policy Transition Group reports contains 94 recommendations on the design and implementation of the policy principles relating to the introduction of a Minerals Resource Rent Tax (MRRT) and the transition arrangements for the Petroleum Resources Rent Tax (PRRT). The report also provides general advice on some possible changes to the PRRT that would also improve its administration.


Tasmanian State Tax Review discussion paper
Tasmanian Department of Treasury and Finance (6 December 2010)

A discussion paper by the Tasmanian Tax Review Panel, which describes current State taxation arrangements and provides questions to guide submissions to the Review. Includes chapters on land and property taxes, payroll tax, gambling taxes, motor taxes and taxes relating to climate change. More details on the Review can be found at: www.treasury.tas.gov.au/statetaxreview


Salvaging Cash for Clunkers
Ian McAuley, University of Canberra and Centre for Policy Development (Nov 2010)

A paper discussing possible options for transforming the Commonwealth’s cleaner car rebate scheme (better known as ‘cash for clunkers’) into an interim reform of motor vehicle taxes.


Resource profits tax radio interview

ABC Radio National interview with Julian Disney about the resource profits tax. (15 June 2010)


Media release: Henry Review and a resources profits tax
Jointly by ACTU, ACOSS, ACF, CFA (June 2010)

Australia needs a robust tax system with fair and efficient taxation of mining super profits.


Impacts of the Resources Super Profits Tax
Dianne Kraal, La Trobe University

Commentary on the Minerals Council of Australia’s report, “Potential Financial Impacts of the Resources Super Profits Tax”.


The Resource Super Profits Tax
Rick Krever, Monash University

A note on the government’s proposal for a “resources super profits tax”.


Australian Conservation Foundation
Australian Conservation Foundation

Progress on resource tax must be matched by strong climate action


A Conceptual Framework for the Reform of Taxes Related to Roads and Transport
Harry Clarke and David Prentice, School of Economics and Finance – La Trobe University (June 2009)

A report prepared for the Commonwealth Treasury that examines how transport services in Australia should charged for and funded.


Tax Reform – Future Direction
David Parker, Executive Director – Revenue Group of the Treasury (17 September 2009)

Speech to the Minerals Council of Australia's Biennial Tax Conference on reforms generally, and the link between resource taxation and company tax.