The Australian Energy Regulator (AER) has today released an initial report on its review of its approach to estimating tax for regulated energy networks.
The initial report summarises and responds to stakeholder submissions to the issues paper released in May. It highlights the lack of publicly accessible information available to the review and lays the case for the AER to use its information gathering powers to request detailed tax records from the energy network service providers.
The AER sets revenue allowances for regulated electricity and gas networks so that their efficient costs can be recovered, including an allowance for tax costs. The AER forecasts the cost of corporate tax in accordance with the relevant legislation—that is, the National Electricity Rules (NER) and the National Gas Rules (NGR)–using a standard tax calculation that has regard to regulatory estimates of taxable revenue, tax expenses and the statutory corporate income tax rate (30 per cent).
We will publish a final report and recommendations on any changes by December 2018.
Invitation for submissions
The AER has released an initial report on its review of its approach to estimating tax for regulated energy networks. It is important that the AER hears from all stakeholders—including networks, consumers and investors. The AER is now seeking written submissions from interested stakeholders in response to this report by close of business 26 July 2018. There will be additional consultation throughout the review.
If you would like to be notified of future developments as part of this review, please subscribe to receive alerts from our website. You can also register your interest by sending an email to TaxReview2018@aer.gov.au.