Australia Brings in Contentious Carbon Tax

By webadmin on 02:06 pm Jul 01, 2012
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Madeleine Coorey

Sydney. Australia on Sunday introduced a controversial carbon tax in a bid to tackle climate change, with Prime Minister Julia Gillard hailing the move amid opposition warnings it will stifle industry.

The tax on corporate pollution, which led to demonstrations across the vast nation when it was announced, will force about 350 major polluters to pay A$23 ($23.50) for every ton of carbon emissions they produce.

It comes into effect on the same day as an equally contentious levy on mining profits, the hard-fought Minerals Resource Rent Tax on iron ore and coal, which helped topple former prime minister Kevin Rudd.

Gillard hailed the introduction of the carbon tax in Australia, one of the world’s worst per capita polluters.

“As a Labor government, we haven’t done all of this for no reason, we’ve done it because we believe it’s pivotal to Australia’s future,” she told the Australian Broadcasting Corporation.

“Today is a Sunday where Australians will go about their ordinary lives, but today is a day too when we seize the future, we seize a clean energy future.”

The government hopes the scheme will mean that by 2020, Australia’s carbon pollution will be at least 159 million tons less per year than it would be otherwise — the equivalent, it says, of taking 45 million cars off the road.

The plan is to start with a fixed price and transition to a market-based emissions trading scheme after three years, similar to that adopted by the Europe Union.

But the tax has been bitterly opposed by the conservative opposition, which argues it will see the cost of living soar and hurt industry, and have vowed to repeal it if they win office in the 2013 elections.

“[The carbon tax] is the slow boa constrictor sapping life out of one business after another,” opposition lawmaker Warren Truss, leader of the Nationals, told the ABC.

Opposition leader Tony Abbott pledged on Twitter that “if elected we will immediately legislate to scrap the carbon tax to help families.”

Gillard said future governments would have difficulty doing so.

“Businesses have got themselves ready for carbon pricing,” she told the “Insiders” program.

“New investments have been made. Against all of that backdrop, Mr. Abbott will find himself in a position where he cannot go to the next election pretending anything else than carbon pricing is going to stay.”

The pollution levy is a deeply divisive issue in Australia, fuelling angry demonstrations after Gillard pledged there would be no carbon tax under a government she led ahead of the 2010 election.

But once elected, after securing the support of the left-leaning Greens to win power in the hung parliament, Gillard set out to introduce a price on carbon.

Gillard said despite the political fallout, the carbon tax was “the right thing” to do to tackle global warming.

“In the months ahead I think as the dust settles from this debate, Australians will be able to see that we’ve done the right thing to tackle climate change,” she told reporters in Melbourne.

“Is the Sunday roast now costing $100? Has the coal industry closed down? Is my weekly shop now 20 percent more expensive? Has Australia entered a permanent depression? They’ll be able to judge that.”

Agence France-Presse