The federal government is expected to score a $10 billion windfall over the next decade after multinational oil giant Chevron abandoned an appeal against the Australian Tax Office in the High Court.

In a settlement believed to be worth more than $1 billion, the US company's case hands Australian authorities a precedent that will shape all future tax arrangements for multinational resources companies.

The decision has been described by the Tax Office as "one of the most important decisions" in corporate tax history and brings to a close one of the largest corporate tax matters before the ATO.

"The ATO's initial estimates are that the Chevron decision will bring in more than $10 billion dollars of additional revenue over the next 10 years in relation to transfer pricing of related party financing alone," said Financial Services Minister Kelly O'Dwyer.