Footnotes

Chapter 1 - Introduction and certain aspects of the Bills

[1]        The Bills were referred to the committee via the adoption of the Senate Selection of Bills Committee's Report No. 15 of 2011. See Journals of the Senate, 2010–11 (no. 63, 3 November 2011), pp. 1735–36.

[2]        House of Representatives Standing Committee on Economics, Advisory report on the Tax Laws Amendment (2011 Measures No. 8) Bill 2011 and the Pay As You Go Withholding Non‑compliance Tax Bill 2011, November 2011.

[3]        Explanatory Memorandum, p. 8.

[4]        Explanatory Memorandum, p. 9.

[5]        Taxation of Alternative Fuels Legislation Amendment Act 2011; Excise Tariff Amendment (Taxation of Alternative Fuels) Act 2011; Customs Tariff Amendment (Taxation of Alternative Fuels) Act 2011; and Energy Grants (Cleaner Fuels) Scheme Amendment Act 2011.

[6]        Explanatory Memorandum, p. 91.

[7]        The Hon. Bill Shorten MP, Assistant Treasurer and Minister for Financial Services and Superannuation, Proof House of Representatives Hansard, 13 October 2011, p. 9.

Chapter 2 - Clarifying the Petroleum Resource Rent Tax taxing point

[1]        The PRRTA Act applied retrospectively to exploration permits awarded on or after 1 July 1984 (when the tax was announced) and recognised expenditures incurred on or after 1 July 1979; Department of Resources, Energy and Tourism, 'The History of Petroleum Resource Rent Tax (PRRT)' www.ret.gov.au/resources/enhancing/taxation/prrt/Pages/TheHistoryofPetroleum
ResourceRentTax(PRRT).aspx, 17 January 2011 (accessed 9 November 2011).

[2]        Commonwealth waters extend from the outer limit of coastal waters to the outer limit of the continental shelf (coastal waters consist of the area between the territorial sea baseline and the line that is three nautical miles seaward of the territorial sea baseline and, where relevant, waters landward of the territorial sea baseline but outside the limits of the state or territory). See Productivity Commission, Review of Regulatory Burden on the Upstream Petroleum (Oil and Gas) Sector, April 2009, p. 46.

[3]        Department of Resources, Energy and Tourism, 'The History of Petroleum Resource Rent Tax (PRRT)' www.ret.gov.au/resources/enhancing/taxation/prrt/Pages/TheHistoryofPetroleum
ResourceRentTax(PRRT).aspx, 17 January 2011 (accessed 9 November 2011).

[4]        Department of Resources, Energy and Tourism, 'Petroleum Resource Rent Tax (PRRT)' www.ret.gov.au/resources/enhancing/taxation/prrt/Pages/PetroleumResourceRentTax(PRRT).aspx, 14 January 2011 (accessed 9 November 2011); Explanatory Memorandum, p. 14.

[5]        The bills which would give effect to this proposal (the Petroleum Resource Rent Tax Assessment Amendment Bill 2011 and related bills) were introduced by the Government on 2 November 2011. This committee is examining these bills as part of a separate inquiry.

[6]        Australian Government, Final Budget Outcome 2010–11, p. 5. This figure is comparatively low compared to other recent years. For example, PRRT revenue was nearly $2.1 billion in
2008–09.

[7]        Australian National Audit Office, Administration of the Petroleum Resource Rent Tax, Audit Report No. 33 2008–09, p. 32; cited in ExxonMobil, Submission 6, attachment 2, p. ii.

[8]        The Federal Court has observed that while the term 'project' and the boundaries of petroleum projects are not explicitly defined, they are informed by other sections and linked to production licences by section 19 (although a licence area does not constitute the entirety of a project); Esso Australia Resources Pty Ltd v Federal Commissioner of Taxation (2011) 194 FCR 32, 79, 80 (Middleton J). The Explanatory Memorandum suggests, however, that not defining a project with reference to particular processes 'ensures that the PRRT can be applied in a practical manner to the various types of petroleum project operations that may arise'; Explanatory Memorandum, p. 14.

[9]        Department of Resources, Energy and Tourism, 'Petroleum Resource Rent Tax (PRRT)' www.ret.gov.au/resources/enhancing/taxation/prrt/Pages/PetroleumResourceRentTax(PRRT).aspx, 14 January 2011 (accessed 9 November 2011); Explanatory Memorandum, p. 14.

[10]      Petroleum Resource Rent Tax Assessment Act 1987, s. 23.

[11]      Petroleum Resource Rent Tax Assessment Act 1987, s. 24.

[12]      The Hon. Bill Shorten MP, Assistant Treasurer and Minister for Financial Services and Superannuation, Proof House of Representatives Hansard, 13 October 2011, p. 8.

[13]      Petroleum Resource Rent Tax Assessment Act 1987, s. 2.

[14]      Petroleum Resource Rent Tax Assessment Act 1987, s. 2.

[15]      See Explanatory Memorandum, pp. 16–17.

[16]      Esso Australia Resources Pty Ltd is a wholly owned subsidiary of ExxonMobil Australia Ltd.

[17]      ExxonMobil, Submission 6, attachment 2, p. iii.

[18]      Explanatory Memorandum, p. 16.

[19]      Esso Australia Resources Pty Ltd v Federal Commissioner of Taxation (2011) 194 FCR 32, 81.

[20]      2011–12 Australian Government Budget, Budget Paper No. 2, p. 40.

[21]      As noted earlier, the products are stabilised crude oil; sales gas; condensate; liquefied petroleum gas; and ethane.

[22]      Explanatory Memorandum, p. 23.

[23]      This alternative interpretation was one of the issues considered in Esso Australia Resources Pty Ltd v Federal Commissioner of Taxation (2011) 194 FCR 32, 81. See Explanatory Memorandum, p. 16.

[24]      The Hon. Bill Shorten MP, Assistant Treasurer and Minister for Financial Services and Superannuation, Proof House of Representatives Hansard, 13 October 2011, p. 8.

[25]      The Senate Standing Committee for the Scrutiny of Bills assesses legislative proposals against a set of accountability standards that focus on the effect of proposed legislation on individual rights, liberties and obligations, and on parliamentary propriety. For more information about the work of this committee, see www.aph.gov.au/Senate/committee/scrutiny/cominfo.htm.

[26]      Senate Standing Committee for the Scrutiny of Bills, Alert Digest No. 13 of 2011, November 2011, p. 9.

[27]      Ms Teresa Dyson, Chair, Taxation Committee, Business Law Section, Law Council of Australia, Proof Committee Hansard, House of Representatives Standing Committee on Economics, 27 October 2011, p. 19.

[28]      Law Council of Australia, Submission 6, p. 2.

[29]      Tax Institute, Submission 8, p. 2.

[30]      Business Council of Australia, Submission 2, p. 2.

[31]      Mr Paul McCullough, Department of the Treasury, Proof Committee Hansard, House of Representatives Standing Committee on Economics, 27 October 2011, p. 2.

[32]      Corporate Tax Association, Submission 7, p. 3.

[33]      Australian Petroleum Production and Exploration Association, Submission 4, pp. 2–3.

[34]      Mr Paul McCullough, Department of the Treasury, Proof Committee Hansard, House of Representatives Standing Committee on Economics, 27 October 2011, p. 6.

[35]      Mr John R. Dashwood, Chairman, ExxonMobil Australia, Proof Committee Hansard, House of Representatives Standing Committee on Economics, 27 October 2011, p. 8.

[36]      Australian Petroleum Production and Exploration Association, Submission 4, p. 2.

[37]      ExxonMobil, Submission 6, p. 2; Australian Petroleum Production and Exploration Association, Submission 4, p. 2.

[38]      For example, the High Court noted in The Australian Building Construction Employees' and Builders Labourers' Federation and Ors v the Commonwealth and Anr: 'It is well established that Parliament may legislate so as to affect and alter rights in issue in pending litigation without interfering with the exercise of judicial power in a way that is inconsistent with the Constitution ... It is otherwise when the legislation in question interferes with the judicial process itself, rather than with the substantive rights which are at issue in the proceedings' (1986) 161 CLR 88, 96 (Gibbs CJ, Mason, Brennan, Deane and Dawson JJ).

[39]      Mr Paul McCullough, Department of the Treasury, Proof Committee Hansard, House of Representatives Standing Committee on Economics, 27 October 2011, pp. 1–2.

Dissenting Report by Coalition Senators

[1]        Business Council of Australia, Submission 2, p. 2 (emphasis added).

[2]        Australian Petroleum Production and Exploration Association, Submission 4, pp. 1–2.

[3]        The Tax Institute, Submission 4, House of Representatives Standing Committee on Economics, Inquiry into Tax Laws Amendment (2011 Measures No. 8) Bill 2011 and the Pay As You Go Withholding Non-compliance Tax Bill 2011 p. 3 (emphasis added).