Australia’s government has presented the “Future Made in Australia (Production Tax Credit and Other Measures) Bill 2024’ to Parliament” , proposing tax incentives on hydrogen and critical minerals production.
This follows after the government published two consultation papers requesting comments on the incentives, which concluded on 12 July, 2024.
The legislation will implement production tax incentives for renewable hydrogen and critical minerals in Australia. The aim of this bill is to make Australia indispensable to the global net zero transformation.
The government hopes this bill will help unlock private sector investment to build a stronger, more diversified and more resilient economy powered by renewable energy that creates secure, well‑paid jobs around the country.
Furthermore, the bill will ensure the benefits from the investment flow to local workers, industries and communities around Australia. This legislation provides industry the clarity and certainty it needs to invest in Australian renewable hydrogen and critical minerals projects with confidence.
The legislation establishes two tax incentives:
- It establishes a Hydrogen Production Tax Incentive worth AUD 2 per kilogram of renewable hydrogen produced between 2027–2028 and 2039–40 for up to ten years per project.
- It establishes a Critical Minerals Production Tax Incentive worth ten per cent of relevant processing and refining costs for Australia’s 31 critical minerals, for critical minerals processed and refined between 2027–28 and 2039–40, for up to ten years per project.
The incentives will only be provided once projects are up and running, producing hydrogen or processing critical minerals used in products like wind turbines, solar panels and electric vehicles.
