Labor Backs Greens Push to Examine Increasing Taxes on Gas Export Profits

A parliamentary probe was ordered ahead of the budget as pressure builds for a 25 percent levy on windfall gas profits.

A ship carrying LNG gas is seen at Rio Tinto’s Dampier Port in Karratha, Australia, on April 11, 2025. AAP Image/Lukas Coch

A parliamentary inquiry into Australia’s gas export taxation has been launched ahead of the federal budget.

Labor joined the Greens on March 30 to establish a committee examining the taxation of Australia’s gas resources, signalling growing openness to changes in the current system.

The inquiry comes as global gas prices surge amid the Middle East conflict, placing Australian exporters on track for significant windfall gains and intensifying calls for a new levy.

Independent Senator David Pocock also called for an urgent 25 percent tax on gas exports, arguing it would help ease cost-of-living pressures while boosting public revenue.

A report released by the Australia Institute on March 30 estimates that a 25 percent export tax could add $49.8 million a day or $348.9 million a week to the budget.

“By delaying a gas export tax, the Albanese government has already missed out on an estimated $68 billion since July 2022,” it said.

The committee, chaired by Greens resources spokesperson Steph Hodgins-May, is expected to report in early May, ahead of the budget.

She has indicated the inquiry will be used to advance the case for a 25 percent tax.

“This inquiry into a gas tax comes at a crunch moment. The gas cartel is poised to cash in on global conflict while Australians are being smashed with rising bills at home,” Hodgins-May said.

Industry, Coalition Push Back

The proposal has drawn strong opposition from industry and parts of the Coalition, who warn that higher taxes could undermine investment and energy security.

Australian Energy Producers Chief Executive Samantha McCulloch said increasing taxes would risk future supply.

“It is no coincidence that the loudest voices calling for more taxes on the gas industry are the same voices trying to shut the industry down,” she said.

She added the sector is already a major contributor to public finances, paying $21.9 billion in taxes and royalties in 2024/25.

Shadow Treasurer Tim Wilson criticised the proposal, arguing it would worsen economic conditions.

“They will only freeze investment and stall private sector job growth,” he said, describing the idea as “next level denial.”

Opposition Leader Angus Taylor also dismissed the proposal.

“We want more oil and gas, and the government’s talking about another tax on oil and gas,” he told reporters.

However, there are differing views within the Coalition, with Shadow Minister for Industry Andrew Hastie indicating openness to considering higher taxes as a way to address inflation and cost-of-living pressures.

AAP contributed to this article.