Fiscal stability and investment vital for economic recovery says APPEA
The Australian Petroleum Production & Exploration Association (APPEA) says Australia must continue efforts to become an attractive, low-risk investment destination for industries, including the oil and gas sector
APPEA have released their 2020-21 pre-Budget submission, in which they recommend the Australian Government commit to five key reforms as having the right fiscal and investment policy settings will help to stabilise Australia’s oil and gas industry and as a result, the wider economy.
APPEA Chief Executive Andrew McConville said with the combined impacts of COVID-19 and the most challenging market conditions faced by Australia in a generation.
Mr McConville said a decade of regulatory instability and market interventions, coupled with being a high-cost investment destination, had reduced investment confidence in many industries, including oil and gas.
APPEA is urging the Government to focus on five key reforms:
- Encourage employment and job creation by making salary and wage costs immediately deductible for taxation purposes.
- Encourage investment and domestic spending through investment allowances.
- Remove barriers to economic restructuring through providing tax asset rollover relief.
- Improve investment and supply certainty by ensuring that taxation laws keep pace with modern commercial practices.
- Encourage exploration activities by extending the Junior Minerals Exploration Incentive and allowing junior oil and gas explorers to access the scheme.
“Australia can secure the next billion-dollar wave of industry developments and help power the nation’s economic recovery, with the right settings in place. Our plan can help Government deliver that. This investment can help stimulate local economies, create employment and generate long-term revenue,” Mr McConville said.
“As the economy recovers from COVID-19, the industry stands ready to provide energy security for homes and manufacturing businesses, generate jobs through exploration and new operations, provide taxation revenue to build schools, roads and hospitals and strengthen our economy."