The AER released an Issues Paper on 15 May 2018 to commence the review. The issues paper outlines the AER’s current regulatory tax approach and the tax allowances set by the AER for regulated networks. It provides some initial observations on the available data on tax payments made by these networks to the ATO. It sets out the proposed scope for the review and includes a proposed timeline.

The AER received preliminary advice from the Australian Tax Office (ATO) that there appeared to be material differences between the tax allowances set by the AER and the actual tax payments made to the ATO by regulated networks. The ATO note also identified a number of drivers for the discrepancy between regulatory tax assessments and tax payments.

The Hon Josh Frydenberg, Federal Minister for the Environment and Energy, has asked the AER to provide an initial report in June 2018, and its final report and recommendations by December 2018.

The ATO note and letter from the Minister are available below.

We invited written submissions on our issues paper. Submissions closed on 31 May 2018. These submissions are available below.