Why a gas tax is back on the agenda
Australia is one of the largest exporters of gas in the world. As Australians see their bills creep up, gas exports are creating a disconnect that is becoming increasingly difficult to ignore.
Australia’s gas resources are publicly owned – they belong to all of us – so when they generate significant profits, people from right across the political spectrum feel that the money could be put to better use in Australia instead of being pocketed by foreign-owned gas companies.
This tension is now being examined more closely at a national level, with the Federal Government’s Senate Committee opening an inquiry to look at what the government could do if Australia could benefit more from gas exports.
If Australia was able to capture more of the wealth generated by its fossil gas resources, the money could be used to strengthen the budget, lower energy costs, provide more social housing and – crucially for the climate – invest in transitioning to the more resilient and sustainable energy systems we need for the future.
That’s why Christina Hobbs, General Manager of Impact across our parent company Future Group, stood up before the Senate Committee Inquiry in Canberra to contribute to discussions on how Australia taxes gas exports, and whether the current setup is delivering a fair outcome for the public or the climate.
Christina Hobbs speaking in Parliament
A system under scrutiny
Australia already applies taxes to gas production, including the Petroleum Resource Rent Tax (PRRT), which was designed to ensure the community receives a share of profits from non-renewable energy resources. Analysis shows just how limited that return currently is – approximately 6.9% of petroleum resource rents.
Compare that to what other countries pocket from their fossil fuel exports, and the gap becomes clear:
Norway captures between 57–60%
Qatar captures around 35%
The United Kingdom captures roughly 38–40%
Norway’s directs oil and gas revenues into a sovereign wealth fund that supports public services and future generations, showing that taxing fossil fuel companies can be normalised. The UK uses an energy profits levy. These approaches differ in design, but they reflect a shared understanding that resource extraction should generate a meaningful return for the community.
Australia gains our 6.9% through a combination of taxes, royalties and excise.
An export levy differs from other taxes because it targets the gas leaving the country rather than profits, quantity or domestic consumption. Royalties are payments for the right to extract the gas, and taxes are based on profits. But an export levy specifically targets gas going overseas.
Structural features like this allow gas companies like Santos and Woodside to make huge profits from exports that are driving the climate crisis, locking households into budget pressures that are already strained by the global fuel crisis. Doesn’t seem fair – or sustainable.
So, to see whether Australia could benefit from introducing an export levy of just 25%, we* commissioned independent modelling with global research firm Arthur D Little.
What the modelling shows
This analysis showed that a 25% export levy could generate up to $17 billion per year for Australia’s sovereign wealth fund, The Future Fund (no relation!), and could also help drive down gas prices for Aussie consumers.
The research found that wholesale electricity prices on the east coast could fall by up to 15% compared to a scenario without the levy. For households and businesses, that would be a real relief.
It also found the levy wouldn’t materially impact export prices or volumes. The levy cost is a tax on the exporting company, not the buyer.
Christina Hobbs explains why an export levy is a no-brainer
Taken together, these findings point to a policy lever that could rebalance outcomes, increasing public benefit without disrupting supply to key trade partners, or undermining the viability of existing gas projects. Our analysis looked at different taxation structures that could use gas profits to deliver reform, and this one looks the most solid.
So when Christina (or Chrissy as we call her) stood up in Parliament to talk the Senators through the rationale for a levy, we had analysis to show why it’s a no-brainer.
“One of the clear benefits of a 25% export tax,” Chrissy told the Senate, “is that it's easy to implement and difficult to game. When we are advocating for options that will provide real-world benefits to the economy and in the interest of our members, this particular policy stacks up not just in terms of revenue but also in terms of its ability to have a real-world impact.”
Fairness and the public interest
Debating gas taxation can sound like deathly dull economic policy, but it ties into themes that matter to us all: fairness, cost of living, sustainability and long-term national interest.
Even though Australia exports large volumes of fossil gas, its households are still at the mercy of international gas prices and price fluctuations, which has led to higher energy costs and highlighted the long-term volatility of the fossil fuel trade So it’s worth putting it under scrutiny.
Our submission joined those arguing that, put simply, Australia could put the profits from fossil gas to better use than handing them to exporters. For example, investing in a more sustainable future for all Australians
What went down in Parliament
Chrissy joined voices including Independent Senator David Pocock, Get Up and Konrad Benjamin from Punters Politics, among 100 submissions made from both sides.
These submissions helped translate complex policy debates into accessible insights, bringing greater attention to how gas exports, pricing, and taxation intersect with everyday economic pressures.
Watch Punters Politics' Konrad in Parliament
Many politicians, including WA Premier Roger Cook and Prime Minister Anthony Albanese have reportedly indicated opposition to the idea. And the gas lobbyists were, of course, also out in force to argue against it. Climate wreckers Shell protested that it already pays PRRT; Chevron and BP both defended the existing regime and warned against changing the structure, while Woodside argued that the tax would jeopardise future gas investment.
“It’s pretty obvious why they’re saying that,” Christina told the Senate Committee, “and that’s because they’re not paying much tax.
“These executives are paid millions and millions of dollars, because they’re very good at communicating to the public and politicians why they shouldn’t have to pay significant amounts of tax. If we look at the lines being run in the media, we are seeing cherry-picked projects that would already be commercially unviable, used as examples of projects that wouldn’t go ahead anyway.
“When investors make investment decisions on a long-term investment like gas,” she continued, “they have to take into consideration future taxation changes.
“A gas company that did not consider that there might be a taxation change ahead, is a company that considers itself able to influence policy to such an extent that a parliament – with all this information in front of them, knowing that their people are being absolutely ripped off – would continue to side with the company.
“As a superannuation fund, we certainly take into consideration these broader macroeconomic trends and things that could occur in a country. We would have seen there's an obvious risk that Australia would at some point want to get a fair share from its industry. And our members' financial interests can only be served if the investment decisions we're making in Australia are being supported by a policy framework that supports a thriving future economy.
“In front of us now is a final opportunity to collect a fair share of income and revenue from our gas sector, and to divert part of that funding into transforming our economy so that we have a robust economy in which to invest in the future.”
Investing in tomorrow
Beyond immediate economic impacts, this conversation also connects directly to the future of Australia’s energy network.
Gas is a fossil fuel, and the long-term climate goals Australia has committed to require a shift to an energy system powered by renewables.
The profits generated from gas exports today represent a potential source of public funding for that transition to a cleaner, cheaper and more secure energy system. This funding could address critical bottlenecks in Australia’s energy transition, in areas such as upgrading transmission infrastructure and supporting the growth of green export industries - like green hydrogen, iron and steel - to replace fossil fuel exports..
Our submission highlights this opportunity, noting that stronger public returns from existing resource extraction could support investment in the systems that will ultimately replace it.
This creates a link between present-day policy decisions and long-term climate outcomes and between economic and environmental considerations. It’s all connected.
At Future Super, we see these conversations as part of a bigger picture.
Superannuation is one of the most powerful economic forces in Australia, shaping industries, infrastructure, and the direction of capital over the long term. Together, we have a voice in where that capital goes.
Why we are all the trillionaires we need
The way that money is invested has real-world consequences, influencing not only financial outcomes but also environmental and social ones.
That is why our approach focuses on:
Screening out fossil fuel companies
Investing in climate solutions like renewables
Advocating for policies that support a fairer and more sustainable economy
We believe that financial structures should serve the communities they operate within, and that long-term value is closely tied to environmental stability and social equity.
So while gas tax policy debates can feel far from everyday life, they do shape the economy and climate that your super depends on.
Superannuation grows over time. But it also funds projects, backs industries, and plays a role in determining what the future economy looks like.
Australia is at a point where key decisions about energy, resources, and investment will determine what happens in the decades ahead. One direction maintains the current settings, where fossil fuel exports benefit the companies that export them. The other way moves towards a greater share of resource wealth, which could help support the transition to cleaner, more resilient forms of energy.
Governments set the policy framework, and companies respond to them, but capital ultimately determines what is built and scaled. And we’ll keep directing capital away from profiteering gas giants and towards a better future for people, communities and the planet.
Call for a fair deal on gas
Are you a small business owner? How are rising energy costs impacting you? How would you like to see gas revenue spent? Have your say and sign BusinessFor75’s open letter for a fair deal on gas.
*as our parent company, Future Group
See Sustainable Investing for information about screening and investment processes, and what we mean by fossil fuel companies.