Australia may limit gas prices but won’t impose a mining tax

On Friday, the Prime Minister of Australia, Anthony Albanese, stated that his administration will consider all measures, including the introduction of a price cap on gas, in order to rein in excessively high-power costs; however, he ruled out the possibility of taxing mining companies. In its budget released a month ago, the Labor government under the leadership of Albanese forecast that household gas and energy costs would rise by 20% to 30% over each of the next two years. This increase was partly attributed to the conflict between Russia and Ukraine. On Friday, Albanese stated to radio station 2GB that “Look, (a price cap on gas) is one of the options that is under consideration.”

Albanese’s comments were made a day after a buyout offer for Origin Energy (ORG.AX) worth A$18.4 billion ($12.2 billion) was made by MidOcean Energy, which was backed by Brookfield Asset Management and EIG. The offer was made in defiance of trade warnings that market intervention would stall funding in new offer. Albanese stated that the federal government does not currently have any plans to impose any new taxes on the “extraordinary profits” made by the power corporations, despite the fact that rising power prices have resulted in windfall earnings for coal miners and gas producers. He stated, “I’m not quite sure what a mining tax is other than a slogan” when he was asked about it.

Albanese stated that his government will not take any action to disrupt the supply of goods. “We have supply contracts with other countries,” the speaker said. Naturally, we have no intention of interfering with any of that in any way. Therefore, this reduces the number of choices that can be considered,” he stated. The European Union and Britain have implemented a windfall tax on the earnings of oil and gas corporations in an effort to raise additional funds to assist households that have been impacted by rising power payments. Joe Biden, the Vice President of the United States, has made the threat to impose one, but it is unlikely that this will win support from the United States Congress.

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