{"id":"C2004A03552","name":"Petroleum Resource Rent Tax Act 1987","slug":"petroleum-resource-rent-tax-act-1987","collection":"act","jurisdiction":"commonwealth","status":"repealed","isInForce":false,"actNumber":"143 of 1987","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":7377,"registerId":"commonwealth-C2004A03552-current","compilationNumber":null,"startDate":"2026-03-30","status":"Repealed","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Petroleum Resource Rent Tax Act 1987","content":"---\nmeta-content-style-type: text/css\nmeta-content-type: application/xhtml+xml; charset=utf-8\n---\n\n?xml version=\"1.0\" encoding=\"utf-8\" standalone=\"no\"?>\n\n![](image.001.png)\n\n \n\n \n\n \n\n \n\n \n\n \n\nPetroleum Resource Rent Tax Act 1987\n\n \n\nNo. 143 of 1987\n\n \n\n \n\n \n\n \n\n \n\nAn Act to impose a tax in respect of the profits of certain petroleum projects\n\n \n\n \n\n \n\nContents\n\n[1 Short title](#_Toc425251452)\n\n[2 Commencement](#_Toc425251453)\n\n[3 Incorporation](#_Toc425251454)\n\n[4 Imposition of tax](#_Toc425251455)\n\n[5 Rate of tax](#_Toc425251456)\n\n \n\n![](image.001.png)\n\n \n\n \n\nPetroleum Resource Rent Tax Act 1987\n\nNo. 143 of 1987\n\n \n\n \n\n \n\nAn Act to impose a tax in respect of the profits of certain petroleum projects\n\n[Assented to 18 December 1987]\n\nThe Parliament of Australia enacts:\n\n1  Short title\n\n  This Act may be cited as the Petroleum Resource Rent Tax Act 1987.\n\n2  Commencement\n\n  This Act shall come into operation on the day on which the Petroleum Resource Rent Tax Assessment Act 1987 comes into operation.\n\n3  Incorporation\n\n  The Petroleum Resource Rent Tax Assessment Act 1987 is incorporated and shall be read as one with this Act.\n\n4  Imposition of tax\n\n  Tax is imposed in respect of the taxable profit of a person of a year of tax in relation to a petroleum project.\n\n5  Rate of tax\n\n  The rate of tax in respect of the taxable profit of a person of a year of tax in relation to a petroleum project is 40%.\n\n \n\n \n\n \n","sortOrder":0}],"analysis":{"kimi_summary":{"_metrics":{"model":"kimi-k2.5","source":"moonshot-batch","completionTokens":1619},"content_quality":"ok","complexity_score":2,"scope_assessment":{"changed":false,"description":"This is the original 1987 legislation and its scope remains tightly constrained to imposing the tax at a fixed rate. While the companion Assessment Act has expanded significantly over decades to cover new projects and calculation methods, this Imposition Act has not drifted from its original, narrow purpose."},"complexity_factors":["Only 5 sections with no internal definitions","No conditional logic, exceptions, or nested provisions","Single operative cross-reference to the Assessment Act (incorporation by reference)","Straightforward command structure: 'Tax is imposed' and 'The rate... is 40%'"],"plain_english_summary":"This Act is the legal engine that makes the **Petroleum Resource Rent Tax (PRRT)** collectible. In simple terms, it does three things:\n\n*   **Imposes the tax**: It creates a legal obligation to pay tax on the \"taxable profit\" made from certain petroleum projects (mainly offshore oil and gas operations).\n*   **Sets the rate**: It fixes the tax rate at **40%** of those profits.\n*   **Links to the rulebook**: It declares itself to be read together with the *Petroleum Resource Rent Tax Assessment Act 1987*. While this Act (the Imposition Act) creates the tax, the Assessment Act contains all the complex rules about how to calculate \"taxable profit\", what deductions are allowed, and who exactly is liable.\n\n**Who it affects**: Companies operating eligible petroleum projects in Australian offshore waters. They pay 40 cents in tax for every dollar of profit above certain thresholds defined in the Assessment Act."},"flash_summary":{"complexity_score":2,"scope_assessment":{"changed":false,"description":"The operative text matches the Act’s stated purpose of imposing a tax on profits of certain petroleum projects: it imposes tax on taxable profit for a year of tax in relation to a petroleum project (section 4) at a 40% rate (section 5), incorporates the Assessment Act for procedural and definitional detail (section 3), and ties commencement to that Assessment Act (section 2). There is no indication in the provided text that the scope departs from that stated objective."},"complexity_factors":["Few substantive provisions: only short title, commencement, incorporation, imposition and rate (sections 1–5).","Heavy reliance on another instrument (Petroleum Resource Rent Tax Assessment Act 1987) for definitions, calculation and administration (section 3) — requires cross-reference to understand full operation.","Temporal dependency: commencement tied to the Assessment Act coming into operation (section 2).","Key economic effect is simple and fixed (single statutory rate of 40%) (section 5), reducing internal complexity but leaving technical tax mechanics to the incorporated Act.","The excerpt does not define central terms (e.g. 'taxable profit', 'petroleum project'), increasing practical complexity through required external lookup (section 3)."],"plain_english_summary":"What this law does, in plain terms\n\n- Mechanically, this Act creates a tax on the profits of petroleum projects. It charges a 40% tax on the \"taxable profit\" that a person has for a year of tax in relation to a petroleum project (sections 4 and 5). The Act itself does not set out the detailed rules for calculating taxable profit or administering the tax; it incorporates the Petroleum Resource Rent Tax Assessment Act 1987, and that Assessment Act is to be read as part of this Act (section 3). The Act comes into effect on the day the Assessment Act comes into operation (section 2).\n\nWho is affected and who pays\n\n- A person who has a taxable profit for a year of tax in relation to a petroleum project is subject to the tax (section 4). The amount payable is 40% of that taxable profit (section 5). The Act’s administrative and calculation rules are located in the incorporated Assessment Act (section 3), so the detailed obligations and procedures for those persons will be set out there.\n\nWhy it matters (claims and how they work mechanically)\n\n- The Act’s stated purpose is to impose a tax on profits of certain petroleum projects (heading and long title). Mechanically, that means taxable profits from covered petroleum projects are reduced by 40% through taxation (section 5). Because the Assessment Act is incorporated (section 3), the mechanics for defining taxable profit, timing, and collection are implemented under the Assessment Act’s rules rather than in these short provisions.\n\nTrade-offs, incentives and implementation points to watch (source-cited)\n\n- Who pays and the cash cost: The statutory payer is any person with taxable profit from a petroleum project; they bear the cash cost equal to 40% of that taxable profit (sections 4–5).\n\n- Incentives and private choices: By applying a 40% tax to taxable profits, the law reduces after-tax returns to those profits (section 5). That mechanical effect can influence private decisions about investment, financing, pricing, ownership stakes or contract terms for petroleum projects — the Act sets the tax liability but does not itself prescribe how businesses must change; those economic responses depend on firms and markets.\n\n- Allocation of administrative detail and discretion: The Act delegates definitional, calculation and assessment detail to the incorporated Assessment Act (section 3). That means the practical compliance obligations, timing, offsets, exemptions and assessment powers will be in that other Act, and implementation depends on how those provisions are drafted and applied.\n\n- Commencement and implementation risk: The tax does not start until the Assessment Act comes into operation (section 2). Any delay or variation in when that Assessment Act takes effect delays implementation of the tax.\n\n- Compliance burden and information needs: The bare imposition here (sections 4–5) signals that the taxpayer must determine \"taxable profit\" for each year of tax in relation to a petroleum project; the detailed calculation method is in the incorporated Assessment Act (section 3). That cross-reference concentrates substantive compliance and recordkeeping requirements in the Assessment Act.\n\nPractical takeaway\n\n- This Act establishes a statutory 40% tax on taxable profits from petroleum projects (sections 4–5), relies on the Petroleum Resource Rent Tax Assessment Act 1987 for definitions and administration (section 3), and only commences when that Assessment Act comes into operation (section 2)."}},"importantCases":[],"_links":{"self":"/api/acts/petroleum-resource-rent-tax-act-1987","history":"/api/acts/petroleum-resource-rent-tax-act-1987/history","analysis":"/api/acts/petroleum-resource-rent-tax-act-1987/analysis","conflicts":"/api/acts/petroleum-resource-rent-tax-act-1987/conflicts","importantCases":"/api/acts/petroleum-resource-rent-tax-act-1987/important-cases","documents":"/api/acts/petroleum-resource-rent-tax-act-1987/documents"}}