Fairer gas transfer pricing
- What it changes
- For integrated LNG projects, PRRT applies to gas at a notional price before liquefaction. The rules set that price by a formula that can push profit into the downstream plant, outside PRRT. This option tightens the formula.
- Revenue estimate
- Not yet costed
- Estimate source and caveats
- No published costing found yet. Ask the PBO for one before quoting a figure. Treasury's 2023 Gas Transfer Pricing Review considered these rules.
- Case for
- Puts the tax point closer to where the value is really made. Addresses a known weakness without changing the PRRT rate.
- Case against
- Technically complex, and industry argues the current formula fairly rewards investment in the liquefaction plant.
- Status
- Under review
