As the Gillard government secured passage of its controversial carbon tax through the lower house of federal parliament this morning, it's time for us to prepare for a future with the hotly-contested new carbon tax.
Cut through the political spin and business-backed advertising and understand what the carbon tax means for you. (More From Yahoo!7 Finance: How To Beat The Carbon Tax)
What is a carbon tax?
A carbon tax is a tax on energy sources which emit carbon dioxide. It's essentially a pollution tax.
Who will be taxed?
The tax, aimed at our biggest carbon polluters, will hit about 500 of our largest businesses. That's companies such as Macquarie Generation Australia and Bluescope Steel. The mining and manufacturing sectors will be most affected by the carbon tax. (More From Yahoo!7 Finance: Gillard, Rudd Celebrate As Carbon Bills Pass)
How much is the carbon tax?
Starting from next July, companies will have to pay $23 for every tonne of carbon they emit into the atmosphere – the government hopes this will encourage them to find green alternatives.
The carbon tax is designed to increase 2.5 per cent every year, for the next three years. On July 1, 2013 the tax will be raised to $24.5 per tonne, and then to $25.40 on July 1, 2014.
Is the government protecting jobs in high-polluting companies?
More than $9 billion has been earmarked to help protect jobs in high carbon-polluting companies. For example, $1.3 billion will go towards a coal sector package, while $300 million has been set aside to help the steel industry move to cleaner solutions. Aluminium, cement, and zinc manufacturers are other industries that will be get government support.
Farmers will not have to pay the carbon tax but will get credits for each tonne of carbon pollution which can be stored on their land. (More From Yahoo!7 Finance: Big Business Launches New Carbon Tax Challenge)
Will households be affected by the carbon tax?
Yes, the carbon tax will push up the price of food, power and other basics but everyday Australians will be compensated through tax cuts, allowances and payments.
It is estimated that about 8 million households will get some help. There are to be two rounds of tax cuts and increases in allowances, payments and benefits. Average household costs are expected to rise by $9.90 per week but the Government will offset this with average compensation of $10.10 per week. (More From Yahoo!7 Finance: Carbon Tax Overview)
Until the carbon tax is actually in place it won't become clear whether the average Australian will be better off or not under a carbon tax.
Is Australia going it alone?
Not really. New Zealand's Emission Trading Scheme started last year, and European countries have had similar schemes since 2005. Parts of the US and Canada have similar schemes. India has recently introduced a tax on coal in an effort to reduce emissions and China is considering a carbon tax for either next year or 2013. Once the emissions trading scheme starts in 2015, there will be scope to link Australia's system into international carbon markets.
What will the carbon tax change?
The Government says that 159m tonnes of carbon will be cut every year. This is roughly the equivalent of taking more than 45 million cars off the road.
The Government hopes that the tax will unleash billions of dollars of investment and innovation into renewable energy, and steer Australian industries away from high polluting energy sources. (More From Yahoo!7 Finance: Countries With The Highest Taxes)
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125 Comments
One of the biggest frauds in history. Just read an article in The Australian - Carbon Tax Credit Market Halfway between Fantasy and Fraud. It won't help the environment one bit. The Rotschilds Australia has 'helped' the Goverment rolled out this 200 billion carbon credit markets. Wake up folks, you don't think those figures in the environmental reports were tweaked just a tad to get this thing going ? Throughout time there has always been a variation of solar radiation causing the temperature to change. Spontaneous fluctuations in global climate, Ice Age that melted. I think we need to do more research about this before we start taxing ! Irresponsible and wrong. Australia is one of the cleanest countries in the world. USA, China, India, Indonesia etc are not paying a tax in this shape or form, so there won't be an international consensus about a carbon tax like the one Australia is already paying. It's absurd.
ReplyIf this wasn't written by the ALP propaganda department, then who ever wrote is took the lazy approach and just cut and pasted from the government press releases. It is just another money grab.
ReplyThe politicians have finally figured out a way to tax air. The oil companies can remain secure since, now that CO2 is defined as a pollutant instead of a natural substance, many alternative energy inventions can never see the light of day, as many of them emit CO2 and water vapor.
ReplyIt's rivers of gold for big business as prices go up for everyone else.
ReplyMoney Money Money. Invest in the big banks, they will trade carbon and make a killing. Invest in publicly listed law firms, they are talking about suing everyone concerned. Manufacturing and process jobs will simply slowly move overseas ( the California experience). The money has to come from somewhere - mug consumers, mainly Labor voters (workers, pensioners and the poor).
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