Why nothing changes

This article was written in the last week of March 2026. In that week, the Department of the Prime Minister and Cabinet requested Treasury modelling on a potential windfall tax on gas and coal company profits, for possible announcement in the May 2026 Budget. Shell Australia’s chair warned against ‘short-term fixes’ and ‘populist rhetoric’ at the Australian Domestic Gas Outlook conference. Chevron’s director of operations called a windfall tax a ‘knee-jerk, sugar hit policy’. Santos CEO Kevin Gallagher said the ‘narrative that LNG exports take money out of Australia’ was wrong. The ACTU, the Greens, independents, One Nation, and crossbench senators all called for a 25 per cent gas export levy. The Australia Institute calculated that Australia would be A$63 billion richer had such a levy been in place since Russia’s invasion of Ukraine. The week encapsulated the entire pattern this series has documented across seven articles. The evidence is overwhelming. The public support is broad. The economic case is unanswerable. The industry response is immediate, coordinated, and identical to 2010. This article explains why the system has perpetuated itself for so long, and what, if anything, is different this time.

01The PRRT in 2026: still falling

The most recent confirmed PRRT forecasts tell the basic story.

In 2025, Budget documents revealed that the government’s 2024 PRRT deductions cap, the reform the industry publicly supported, would raise A$4 billion less over the forward estimates than the government had projected in 2023. This was not a minor revision. The government had said the reform would raise an additional A$2.4 billion over four years. Instead, PRRT revenue across the same period went down.

Treasurer Chalmers defended the revenue revision as a result of oil price volatility. His defence was technically accurate but strategically inadequate: a well-designed resource rent tax would capture more revenue when prices rise, not less. The design flaw in the PRRT is precisely that it does not behave this way.

02The pattern: five reform attempts, five failures

This series has now documented the history of resource rent reform failure in Australia across two decades. The table reveals something important about how the system perpetuates itself: the industry has learned to deploy two strategies, not just one.

The first is overt opposition: the 2010 campaign against the RSPT, the campaign against carbon pricing. The second is co-option: supporting reforms weak enough not to matter, as with the 2024 PRRT deductions cap.

Both strategies produce the same outcome: no meaningful increase in resource rent capture.

03The 2026 moment: a new windfall, a familiar campaign

The immediate trigger for the March 2026 windfall tax discussion is the Iran war. Conflict in the Middle East has driven global oil and gas prices upward. Approximately 20 per cent of global gas supply passes through the Strait of Hormuz, substantially closed during the conflict. Australian LNG exporters (Woodside, Santos, Chevron, Shell, INPEX) are the automatic beneficiaries of surging prices on gas they committed to sell before the conflict began.

Within 24 hours of reports that the PM’s department had asked Treasury to model such a levy, the industry response arrived. Shell warned against ‘short-term measures or populist rhetoric.’ Chevron called it a ‘knee-jerk, sugar hit.’ Santos said the narrative that LNG exports take money out of Australia was ‘wrong.’ These statements were made at the Australian Domestic Gas Outlook conference, the industry’s annual gathering, on the same day. They are coordinated. They invoke the same language used in 2010: investment at risk, energy security threatened, populist interference in stable policy settings.

As analyst Rex Patrick noted, the industry had cried wolf in the UK in 2022 with identical arguments. The UK Chancellor introduced a 25 per cent Energy Profits Levy anyway, later raised it to 35 per cent, and raised £2.6 billion in the first year. Investment continued. The industry’s warnings proved false.

04Why nothing changes: the structural explanation

This series has now documented, across seven articles, all the major components of the system that perpetuates the gas rort.

1. A tax designed to fail. The PRRT was designed for oil in 1988. Applied to LNG, its compounding deduction uplift rates, its gas transfer pricing formula, and its ‘taxing point’ rules combine to produce an effective rate near zero for most projects, for most of their productive lives. The design is not an accident. It is the product of decades of industry consultation where the companies subject to the tax had substantial input into how it worked.

2. A political system that is purchased. The gas industry donated A$3.98 million to Australia’s major parties in 2024–25 alone. Woodside held platinum corporate memberships, giving access to private dinners with the Prime Minister and Treasurer, simultaneously with both the government and opposition. The donation strategy is not ideological. It is designed to ensure that regardless of which party governs, the industry has access to the decision-makers.

3. A revolving door that embeds industry preferences. The minister who oversaw the approval of Queensland’s LNG export industry joined the peak gas lobby within six months of leaving parliament, in breach of the Ministerial Code. His staff became directors of APPEA and the Minerals Council. This is not corruption in any prosecutable sense. It is a structural arrangement that ensures industry preferences are embedded in the institutional knowledge of the regulators.

4. A campaign template that has never been defeated. The 2010 mining tax campaign established a template that University of Melbourne academics have described as ‘now routine.’ Every resource rent reform attempt since 2010 has faced a version of the same campaign. The template works: warn of investment flight, manufacture grassroots opposition, declare the reform anti-Australian.

5. A reform process captured by the reformed. The 2024 PRRT deductions cap was supported by the gas industry because the industry had negotiated it. When the regulated industry publicly supports the regulation being imposed on it, the regulation is not asking much. As Senator Pocock noted, the government examined its options and chose the weakest one. The result: a reform that raised A$4 billion less than promised and left the PRRT on a downward trajectory.

The system is not maintained by conspiracy. It is maintained by design.

The PRRT is complicated enough that only a handful of people understand it, and most of them are employed by the industry or its regulators. The Ministerial Code is not enforced. The donations are legal. The platinum memberships are disclosed, partially. And every time reform gets close, the same campaign deploys the same language and the same warnings, which Australian policymakers have learned, from 2010, to take seriously. Even when the warnings are false.

05What is different in 2026

It would be easy to conclude that nothing will change. The pattern is long and the structural barriers are high. But several features of the current moment did not exist in 2010 or 2022.

First, the Epstein files. The revelation in January 2026 that the 2010 anti-RSPT campaign was coordinated by a British political operative who privately admitted there was no principled argument against the tax, and who forwarded strategy documents to a convicted sex offender, changed the public record permanently. The campaign’s dishonesty is now documented in primary sources.

Second, the Senate Estimates moment. Senator Pocock’s beer-and-PRRT comparison was watched 8.7 million times. The public understanding of the issue is qualitatively different from 2010 or 2022. Australians who have never engaged with resource taxation policy now know that the PRRT raises less than beer excise.

Third, the breadth of support for reform. The 25 per cent export levy is now backed by the ACTU, the Greens, independents, and even One Nation, a political coalition that cuts across every conventional ideological line. Even the opposition, in the 2025 election, conceded publicly that Australia had ‘a gas export problem, not a gas shortage problem.’

Fourth, the windfall context. The Iran war has produced exactly the circumstances that make the moral case for a windfall levy unanswerable: gas companies are making extraordinary profits from a geopolitical tragedy while Australian families pay surging fuel prices.

Fifth, the May 2026 Budget. Treasury had been asked to model the levy. The model existed. Update, 9 September 2026: the government did not use it. See the update below for the Budget outcome in full.

06The rort, in real time

This article is unusual because it is being published while the story is still unresolved. As of the last week of March 2026, the government has not committed to a windfall tax. The industry has deployed its campaign. The May Budget was five weeks away.

Update, 9 September 2026. The 2026-27 Budget was delivered on 12 May 2026. It contained no windfall tax or export levy on gas or coal company profits. The only new gas measure was a Domestic Gas Reservation Mechanism, reserving 20 per cent of LNG exports for the domestic market from 1 July 2027, funded within a wider A$35.5 million, four-year measure to support the domestic wholesale gas market. The PRRT revenue forecast was revised up, by A$400.0 million for 2026-27 and A$1.6 billion over the five years to 2029-30, but Budget Paper No. 1 attributes the revision to higher oil prices linked to the Middle East conflict, not to new tax policy; the ABC reported the same A$400 million figure and noted gas companies had ‘avoided a 25 per cent export tax, despite a sustained social media campaign and a recent Senate inquiry probing the issue.’ Pocock’s proposed inquiry became the Senate Select Committee on the Taxation of Gas Resources, established on 30 March 2026; it was chaired by Greens Senator Steph Hodgins-May, with Pocock sitting as a member rather than chair. The committee tabled its final report on 7 May 2026 without reaching a majority position on gas tax reform: neither Labor nor Coalition members backed the 25 per cent export levy, which appears only in the Chair’s additional comments. The Budget of 12 May 2026 contained no windfall or export levy and no new PRRT policy; the PRRT forecast moved only with oil prices.

Update, 30 September 2026. The paragraph above gave 1 July 2027 as the start of the Domestic Gas Reservation Mechanism, the date in Budget Paper No. 2 of 12 May 2026. The ministers’ joint media release of 10 September 2026 says the “licence application process will commence from 1 January 2027, with the Domestic Supply Obligation to commence from 1 January 2028”. The start dates are therefore 1 January 2027 for licence applications and 1 January 2028 for the Domestic Supply Obligation. The 1 July 2027 date is left in place as what the Budget announced ²¹.

What this series has established, across seven articles, is the full context for that Budget decision. It is not a technical question about petroleum tax design. It is a political question: is Australia capable of doing what it has failed to do since 2010, and implementing a resource rent tax that actually captures the public’s fair share of the public’s resources?

The tools exist. Pocock’s proposed inquiry became the Senate Select Committee on the Taxation of Gas Resources, established 30 March 2026 and chaired by Greens Senator Steph Hodgins-May; it reported on 7 May 2026 without a majority position on reform (see the update above). The ANU’s Chris Murphy has confirmed that resource rent taxes have a negative marginal excess burden, meaning they generate economic benefits, not costs.

The only question is political will. And the only way political will materialises is if the public pressure for change exceeds the industry pressure to prevent it.

Article 8 of this series examines how Australia’s major media organisations have covered, and not covered, the gas rort.

If it’s a rort, we cover it.