Teachers pay more tax than the oil and gas industry

by Matt Grudnoff

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Oil and gas companies claim they pay the wages of teachers and other public sector services, but teachers actually pay twice the tax.

The oil and gas industry loves to tell Australians that they pay a lot of tax, but the evidence says otherwise.

Not only has the Australian Taxation Office (ATO) described the oil and gas industry as home to “systemic non-payers” of tax, but new Australia Institute research shows that Australia’s teachers pay twice as much tax as the oil and gas industry.

Read that again if you have to. Teachers pay more in personal income tax than the entire oil and gas industry pays in company tax and Petroleum Resource Rent Tax (PRRT).

Over the last ten years, ATO data shows that all of Australia’s school teachers paid $95 billion in personal income tax, an average of $9.5 billion per year.

By contrast, the oil and gas industry paid $12.5 billion in PRRT and $33 billion in company tax over the last ten years, or an average of just $4.6 billion per year.

It’s worth noting that almost all of the oil and gas industry’s payments have occurred in the last two years, since Russia invaded Ukraine and pushed energy prices to record levels. While official ATO figures haven’t been released yet, the oil and gas lobby group Australian Energy Producers claims that its members paid $10.5 billion in 2022-23 and $14.2 billion in 2023-24. These lobby group figures are included in the above chart. If assessing the average annual tax payment of the oil and gas industry based on only ATO figures, that exclude the Russia war-linked windfalls, then the average is $2.6 billion per year over the ten years to 2020-21.

The oil and gas industry employs few people and pays barely any tax. Instead, the profits from Australian gas extraction flow overseas to mainly foreign owners. Australians are largely missing out.

The resource sector may claim that it is funding schools and hospitals, but it is doing little when compared to other industries.

We need genuine reform of the PRRT to ensure that Australians are getting their fair share from the oil and gas industry.

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