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  • Trends and latest findings

    The petroleum resource rent tax (PRRT) gap has been relatively steady over the years estimated. It reduced in 2015–16 and has remained at a similar rate in subsequent years.

    We have a high level of coverage of the PRRT client base covered by this legislation. We know who these taxpayers are and the PRRT projects they are involved in. We have observed a high level of willing participation, with most taxpayers correctly registering, lodging and paying on time.

    The main driver of the PRRT gap is the complex tax law which can result in different interpretations. This is particularly the case in the calculation of assessable receipts, and the deductibility and classification of expenditure. A further complexity arises due to a number of key concepts of the PRRT that differ from equivalent income tax concepts.

    Overall, the tax gap has ranged from 2.8% to 1.7% over the five years estimated.

    Table 1 shows the tax reported and tax gap from 2013–14 to 2017–18.

    Table 1: PRRT gap, 2013–14 to 2017–18

    Element

    2013–14

    2014–15

    2015–16

    2016–17

    2017–18

    Tax gap ($m)

    53

    32

    17

    18

    21

    Tax paid ($m)

    1,827

    1,244

    983

    1,033

    1,212

    Theoretical liability ($m)

    1,880

    1,277

    1,000

    1,051

    1,233

    Tax gap (%)

    2.8%

    2.5%

    1.7%

    1.7%

    1.7%

    Figure 1 displays a trend of the PRRT gap percentages over the same period.

    Figure 1: Tax gap percentage – PRRT, 2013–14 to 2017–18

    Figure 1: Image shows the gross and net gap in percentage terms as outlined in Table 1.

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      Last modified: 19 Oct 2020QC 57597