Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024

The majority voted in favour of a motion that the remaining stages of the bill be agreed to and the bill be now passed. In other words, they voted to read the bill for a third time, which is parliamentary jargon for agreeing with the main idea of the bill. Because this division was successful, the bill will now be sent to the House of Representatives where our MPs will decide on whether they agree with the Senate amendments.

What does this bill do?

According to the bills digest (which is a document prepared by the parliamentary library):

• The Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024 (the Bill) introduces the Hydrogen Production tax offset (HPTO) and the Critical Minerals Production Tax Incentive tax offset (CMPTI tax offset) to incentivise hydrogen and critical minerals production by companies that satisfy specific conditions.
• The HPTO is $2 per kilogram of hydrogen produced, and the CMPTI tax offset is 10% of eligible expenditure incurred through the production of specified critical minerals. Both incentives will be available from 1 July 2027 until 30 June 2040, but companies are only able to access the incentives for a maximum of 10 years.
• The Bill also imposes liability for, and requires payment of, the shortfall interest charge where a person has received excess tax offsets including, but not limited to, the HPTO and the CMPTI tax offset.
• Additionally, the Bill amends the general anti-avoidance rules in Part IVA of the Income Tax Assessment Act 1936 so that the HTPO and the CMPTI tax offset are a ‘tax benefit’ to which Part IVA can apply. This potentially allows those offsets to be cancelled in whole or in part if Part IVA is satisfied.
• Finally, the Bill introduces changes to Indigenous Business Australia (IBA) by expanding the circumstances in which IBA can borrow money.
• The Bill has been referred to the Senate Economics Legislation Committee (SELC) for inquiry and report by 30 January 2025. Submissions closed on 9 January 2025.
• At the time of writing, the Bill had not been considered by the Senate Scrutiny of Bills Committee nor the Parliamentary Joint Committee on Human Rights.