The gas sector has pushed back on broad calls for tax reform aimed at increasing revenue from the industry, pointing to forecasts of a surge in tax being paid this year.
Industry forecasts suggests the total tax paid to state and federal governments this financial year will more than double, from $6.5billion last year to $16.3 billion.
That includes a quadrupling in company tax from $2 billion to $8.8 billion, but only a modest increase in petroleum resources rent tax (PRRT) from $1.2 billion to $1.8 billion.
The federal government has been preparing the ground for changes to the PRRT, which could form part of next month's budget.
The treasurer has recently received a long-awaited review of the controversial tax from Treasury, and the gas sector has been consulted on changes.
It taxes profits from offshore oil and gas projects at 40 per cent, on the grounds they are selling Commonwealth resources.
It has been widely criticised for failing to raise significant revenue despite soaring gas prices over the past couple of years.
Demand for gas worldwide has pushed up export prices, from $2.50 a gigajoule in mid-2020 to a peak of more than $66 a gigajoule in mid-2022.
Samantha McCulloch from industry body APPEA said given tax revenues from the sector are growing, the government has little case for change.
"The tax take to government will triple this year, the system is working," she said.
"We would urge the government to tread carefully in terms of looking at changes to the PRRT to ensure that any short term gains aren't offset by a longer term contraction in revenue."
Woodside chief executive Meg O'Neill used a national press club address this week to urge the government not to raise taxes on the sector.
"Our message to the government is hold the course, stay with the framework we have, it's delivering very well for Australians," she said.
"When we do well, Australia does well."
But Treasurer Jim Chalmers indicated this week the government is inclined towards change.
"We've said for some time now that we want to make sure that the PRRT arrangements are up to scratch," he said.
"Clearly my predecessors had concerns that they were not and I have some concerns that they are not.
"The Australian community, I think shares those concerns."
Growing calls for tax hike
The government has been urged for some time from both inside and outside the parliament to adjust the PRRT, and try and earn more revenue from the sector.
Policy think-tank the Grattan Institute has suggested the government pursue changes to how profits from gas projects are measured, based on previous work undertaken by Treasury.
Under the changes it suggests, it estimates the government the could bring in $3 to $4 billion dollars a year in additional revenue.
The Greens have proposed more radical changes, essentially wiping out existing carried-forward tax credits that gas companies use to reduce their PRRT liability.
They also suggest a 10 per cent royalty be applied to offshore projects, and estimate the two measures would raise more than $90 billion over a decade.
Economist Chris Richardson said successive Australian governments had "stuffed up" the design of the scheme.
"It's Australian governments, a whole bunch of them over decades, made mistakes that made this tax, too generous," he said.
"At the moment, existing tax arrangements favour those gas producers a whole lot and taxpayers have lost out far too much.
"We've ended up with a tax that doesn't collect basically any money from some key gas production sites and may never do so."
