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Australian fossil fuel subsidies reached $10.3 billion this financial year

Updated: Jun 29

Fossil fuel subsidies have cost government budgets at state, territory and federal levels an estimated $10.3 billion in the last financial year alone. This equates to $19,686 a minute, according to a new report from The Australia Institute.


Here are the key findings from The Australia Institute's research:


  • The Commonwealth’s main tax break to major fossil fuel users cost $7.84 billion, exceeding the $7.82 billion spent on the Australian Army

  • In fact, $10.3 billion in Government subsidies means that in 2020, this equates to $19,686 per minute effectively given to coal, oil and gas companies and major users of fossil fuels

  • State Governments spent $1.2 billion mainly through subsidising exploration, refurbishing coal ports, railways and power stations and funding ‘clean coal’ research.

  • State governments continue to pour money into coal ports and railways despite Queensland Treasury advice that ‘spending on mining related infrastructure means less infrastructure spending on hospitals and schools’.

  • $8.3 billion in assistance is already committed to longer term fossil fuel subsidies, led by the NT government’s $3.8 billion gas purchase from Italian oil and gas company Eni.


Read The Australia Institutes media release with the full list of findings here.


At a state level, Queensland subsidies included the upgrading of coal and gas power stations, the introduction of a ‘mine dozer replacement program’ and provided other assistance measures worth an estimated $744 million last year, only marginally less than the $818 million spent on Fire and Emergency Services.


“Coal, oil and gas companies in Australia give the impression that they are major contributors to the Australian economy, but our research shows that they are major recipients of government funds...“From a climate perspective this is inexcusable and from an economic perspective it is irresponsible. The major subsidies are Commonwealth tax breaks that mean the largest users of fossil fuels get a refund worth $7.8 billion on a tax that the rest of the community has to pay.”
- Rod Campbell, Research Director at The Australia Institute.

Mining lobby groups and multiple politicians have rejected The Australia Institute's findings in the past, providing commentary that the 'assumptions' made by the think tank are flawed and do not adequately consider the industry's contribution to the Australian economy.


Queensland Senator Matt Canavan has stated that a net-zero emissions target makes 'no sense' due to current tensions with China.


The Australia Institute is a progressive think tank which is independently funded by donations from philanthropic trusts and individuals, as well as grants and commissioned research from business, unions and non-government organisations. The Australia Institute does not accept donations or commissioned work from political parties.