Cost of Carbon Tax May Hit $132 Billion

26 Oct 11

The accumulated cost of the Labor Government’s Carbon Tax and associated expenditure will hit $132 billion over its first 9 years.

A Liberal Party Press Release states that new figures reveal the real cost for reducing Australia’s emissions under the Carbon Tax has now blown out to $225 per tonne of domestic abatement.

The Carbon Tax now tops the list of Labor’s most excessive waste of taxpayers’ money the press release details.

• $105 billion of taxes out to 2020/21 largely paid for in electricity, gas and diesel price rises.
• A further $15 billion in direct government expenditure. This includes $10 billion of unfunded expenditure to buy shares in speculative energy companies that the private sector will not support. It also includes $3 billion in other energy programs and $2 billion to close down power stations.
• $4 billion budget deficit in the tax and transfer payments associated with the package in just its first three years.
• Purchase of at least $8 billion in foreign carbon credits to 2020. In 2020 alone, Australian companies will have to purchase $3.5 billion in foreign carbon credits on top of the Carbon Tax.

The opposition state that despite the $132 billion cost, Australian emissions will increase over that time from 578 million tonnes to 621 million tonnes by 2020.

For this reason, the opposition are calling for the Carbon Tax to be removed and believe the next election will be a referendum on the Carbon Tax and if elected, the Coalition state that they will repeal the Carbon Tax as the first order of business.

The opposition believe that the ALP should explain why it ignored the will of the people at the last election and why it now says it will ignore the will of the people at the next election.

The opposition have labelled the tax as a massive electricity tax, the Coalition indicate that they would deliver its Direct Action Plan to reduce Australia’s emissions by providing incentives for business to clean up our own local environment and invest in renewable energy, with a capped and fully funded $3.2 billion program.

As far as Advanced Manufacturing is concerned, incentives to invest in new and more energy efficient technologies is essential if our manufacturers are to remain competitive. Furthermore a new machine tool, by virtue of new technology, will utilise significantly less electricity than older models. But there is no such incentive to invest, rather a cost burden to be levied on our manufacturers by virtue of higher electricity costs, which is a disincentive.