Australia Collects More Tax on Beer Than on Gas. Here's Why That Should Bother You.

Australia is one of the world's largest exporters of liquefied natural gas. In 2026, it is losing $350 million every week, roughly $2 million every hour, because it has chosen not to tax those exports adequately (The Point, 2026). Senator David Pocock wants to change that. So far, both major parties have voted to stop even the conversation from happening.

The tax that collects less than a six-pack

Australia's current gas export tax is called the Petroleum Resource Rent Tax (PRRT). It is levied on profits — not revenue. That matters, because profit is a number companies can control through accounting: depreciation allowances, project cost deductions, and years of carried-forward losses can reduce taxable profit to near zero. That is precisely what has happened.

As Pocock noted in the Senate in February 2026, “Australia generates more revenue from beer excise than from the PRRT on liquefied natural gas exports” (The Point, 2026). The country extracts and ships billions of dollars worth of gas every week. The public purse collects less from it than it does from a trip to the bottle shop.

Compare that to how other countries handle their natural resources. Norway takes 78% of oil and gas profits through a combination of company tax and a resource rent charge. Qatar imposes a 35% royalty on gas production. Canada and the United Kingdom both apply resource royalties that guarantee a public return regardless of how companies structure their costs (The Australia Institute, 2026).

Australia, by contrast, allows LNG exporters to pay zero royalties on gas from six of its seven major export terminals (The Australia Institute, 2026). The gas leaves. The money follows it.

The proposal most politicians don't want discussed

Senator Pocock backed by analysis from the Australia Institute and supported by the Australian Council of Trade Unions, is calling for a 25% tax on gas export revenue, not profits. Revenue-based taxation is much harder to avoid: it applies to the value of what is sold, not what is left over after costs. The Australia Institute modelled this and found it would raise $17 billion per year (The Point, 2026).

That $17 billion is not hypothetical. It represents the value Australians are currently not receiving from resources that legally belong to the Australian public. To examine the issue, Pocock proposed a Senate inquiry, a basic parliamentary mechanism for gathering evidence and informing policy. Labor voted against it. The Coalition abstained. The inquiry was voted down before it could begin (Accounting Times, 2026).

The Prime Minister's response to Pocock was to characterise him as "someone who seeks to promote grievance" (The Point, 2026). The substance of the argument, that Australia is receiving a poor return on a public resource was not addressed.

The insight most people miss: this is not a left-right issue

Gas taxation in Australia tends to be framed as a battle between progressive environmentalists and conservative resource advocates. The polling data tells a completely different story.

Cross-party research by RedBridge found that 67% of One Nation voters and 70% of Greens voters support a 25% gas export tax. Support runs strongly across Labor, Liberal, and independent voters too (The Australia Institute, 2026). This is not a partisan issue. It is a public interest issue that the two major parties — both of whom receive donations from the gas industry, have aligned to suppress.

Meanwhile, Australian governments are simultaneously providing $16.3 billion in fossil fuel subsidies in 2025–26, approximately $31,000 every minute, flowing toward the same industry that is returning less in tax than beer (The Australia Institute, 2026).

The exported gas from the past five years alone could have supplied Australia's entire domestic market for roughly two decades at current consumption rates. Instead, domestic gas prices have tripled over the past decade (The Australia Institute, 2026). Australia exports the resource, pays companies to produce it, and then buys it back at inflated rates for domestic use.

What this means for investors and the energy transition

For Australians with superannuation or investments in Australian energy companies, Woodside, Santos, and others, this policy debate carries direct financial relevance. If a gas export tax is eventually legislated (and the political momentum is building toward the federal budget in May 2026), it will change the revenue outlook for Australia's largest LNG producers (Bloomberg, 2026).

Impact investors are paying attention. Capital is already shifting toward energy transition assets partly because regulatory risk on fossil fuels is rising globally. The Australian gas debate is one more signal that the current business model of extract cheaply, export at scale, pay minimal tax, is not politically sustainable in the long run.

The Ripple Effect

Australians overwhelmingly agree that the country deserves a better deal from its gas resources. The challenge is not public opinion, it is that the institutions designed to act on that opinion have chosen not to. Pocock's proposal has started a conversation that neither major party wanted to have before the budget. Whether it translates into policy next month or beyond, the underlying arithmetic is not going away: $350 million a week in foregone revenue, a domestic energy market paying inflated prices, and a tax system that collects more from beer than from one of the most valuable export industries in the country. That is not a grievance. It is a structural choice. And structural choices can be changed.

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References

The Point, Gas Giveaway Tracker reveals $350 million a week lost as pressure mounts for gas export tax, 30 March 2026.

The Point, Independent Senator David Pocock calls for 25 per cent tax on gas exports, 25 February 2026.

The Australia Institute, Australia's gas ripoff cuts across political lines, 2026.

Accounting Times, Senate votes down Greens' proposal for 25% gas export tax, 2026.

Bloomberg, Australia Weighs LNG Windfall Tax as World Faces Soaring Prices, 20 March 2026.

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