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Repeal Carbon Tax, Australian Industry Tells Senate

by Mary Swire, Tax-News.com, Hong Kong

16 December 2013


The Australian Senate has been urged to "spare business and households additional cost and uncertainty," and scrap the carbon tax.

The call was made by the Australian Industry Group (Ai Group), which warned of "great complications" should the Senate vote against the Government's proposals. It is thought that electricity pricing and contracting deals will bear the brunt of any extended delays.

Group Chief Executive Innes Willox recommended that both the Labor Opposition and Green parties no longer focus on less crucial elements of the Government's repeal package, such as the Clean Energy Finance Corporation and the Climate Change Authority. He stressed that resolving these issues was not urgent, because the two bodies do not impose any additional costs on energy. The Treasury should, therefore, "take the chance to repeal the core carbon pricing mechanism right away, giving energy users, generators and retailers the maximum chance to prepare."

Willox added that Australians need "a sound policy basis for future investment." To provide this, the country must "clear away the carbon tax and to focus on the major task of designing the Direct Action approach to meet the emission reduction targets to which Australia has committed."

Prime Minister Tony Abbott's Coalition does not have a majority in the Senate. However, the Senate's Environment and Communications Legislation Committee, which reviewed the repeal bills, is backing the Government on the issue. It found that the levy is "one of the highest and broadest carbon taxes in the world," and has "had a significant impact on costs for Australian businesses and families."

The Senate is expected to vote on the legislation within the next week and half, and the Government intends for the tax to be removed by July, 2014.

TAGS: Finance | Energy | tax | investment | business | energy | Australia | legislation | tax rates | carbon tax | tax reform | retail | Communications

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