Critical minerals tax credit in the works
Consultation has begun for the Federal Government’s $13.7b production tax incentives.
The production tax credits are designed to incentivise investment in renewable hydrogen, boost production of critical minerals and create jobs and opportunities for Australians.
Federal Treasurer Jim Chalmers says the tax incentives are essential to the Future Made in Australia package in the Federal Budget.
“The global energy transformation represents a golden opportunity for Australia and our production tax incentives will help us make the most of that opportunity,” he said.
“Our production tax incentives will unlock new investment and new jobs in renewable hydrogen and critical minerals processing.”
Two Treasury consultation papers have been released seeking stakeholder feedback on the proposed Hydrogen Production Tax Incentive and Critical Minerals Production Tax Incentive.
The Hydrogen Production Tax Incentive
The Hydrogen Production Tax Incentive is a time?limited measure to accelerate the growth of Australia’s hydrogen industry.
The tax incentive intends to support the production of renewable hydrogen from 2027–28 to 2039–40 to assist in Australia’s net zero transformation.
It’s intended to bring forward project development, make renewable hydrogen available sooner, and build scale to reduce production costs over time.
Critical Minerals Production Tax Incentive
The Critical Minerals Production Tax Incentive allows eligible entities to claim 10% of expenditure for processing and refining any of the 31 minerals currently published on the Government’s Critical Minerals list.
This incentive is intended to assist in extracting more value onshore from Australian resources by building sovereign capability in critical minerals processing.
Both papers are available on the Treasury website and consultation will continue until July 12, 2024.
