MOTORISTS are not just feeling the Federal Government’s bite at the bowser. Australian oil is getting taxed at the wellhead too.
Besides the petrol excise, the Government also takes 40 per cent of a company’s oil project profits through its rent resource tax.
The tax is applied in addition to the company tax levied on those profits.
Australia produces about 500,000 barrels of oil per day and some estimates put the value of the Government’s oil tax take at about US$6 million a day.
This means the Federal Treasury is gaining about $3.5 billion per year just from this tax.
If the world oil price increases, the Government’s take rises accordingly.
This could mean the Government has the ability to reduce the fuel excise that is partly blamed for increased fuel prices at the bowser.
However, the rent resource tax does not affect oil production from WA’s North West Shelf or Barrow Island projects.
The North West Shelf projects are covered by a Federal royalty and excise system.
The WA Government takes its share of WA oil production revenues.
Its take is about $17 million per year for every US$1 per barrel over a year.
If the oil price stays around its present level, the Government will receive about $510 million in royalties.
