Global Daily Tax News, Australia Fleshes Out Plans For Hydrogen, Critical Minerals Tax Breaks, (May 20, 2024)

The Australian Taxation Office has released guidance on the sizeable hydrogen and critical minerals industry tax relief measures announced in the 2024-25 Budget.

The ATO has confirmed that the Critical Minerals Production Tax Incentive will be available from July 1, 2027. The incentive will provide eligible recipients with a refundable tax offset of 10 percent for the costs of processing the 31 critical minerals currently listed in Australia. The credit will be available for a maximum of 10 years until no later than June 30, 2040. At a later date, Australia will launch a consultation on eligible processing costs.

The Government has yet to decide on the design of the temporary Hydrogen Production Tax Incentive, with a consultation planned for the future. For now, it has confirmed it will be a time-limited and uncapped refundable tax offset that will be available for a maximum of ten years from July 1, 2027, until June 30, 2040, for projects that reach final investment decisions by 2030.