Cuts on Tax Breaks Would Hurt Economy LNG Says

Billions of investments and the loss of jobs by the thousands are what would happen if the Treasury imposes tax breaks cuts

This essentially lowers company tax rates to 30 percent and removes concessions in the Liquified Natural Gas (LNG) industry. According to its insiders, it will also make the LNG sector the “most uncompetitive” against other countries such as Indonesia, the United States and Russia.

According to the Australian Petroleum Production and Exploration Association (APPEA), about 12,000 full-time workers may also stand to lose their jobs. With several projects lined up for the LNG industry, the country could lose about $27 billion in investments if it ends up that these projects are cancelled due to lack of workers and funding.

APPEA implied that banks can benefit from this tax cuts, but as a whole, not all sectors will be able to take advantage of it.

The group also said that targeting the resource industry’s tax breaks would benefit some sectors like the banking industry. This, however, would do little for the whole economy.

In its statement, APPEA said that any change that affects capital-intensive and infrastructure sectors would have an impact on how Australia creates sustainable taxation revenue streams.

Miners also chimed behind the LNG industry, saying that the sector could also lose out among other economies if the options proposed by the Treasury are implemented.

Meanwhile, the Institute of Chartered Accountants also supported APPEA by saying that the country’s economy can lose about $1.18 billion due to these cuts and depreciation rules.