By JR on Monday, July 11, 2011
Just announced in Australia. It's just a particularly destructive class-war tax with millions of above-average earners hit. That's a lot of votes to risk. And every price-rise henceforth will now be blamed on it! There will be opportunistic price-rises everywhere. Epic fail!
Five current articles below
Hardest hit by carbon tax is Australia's largest city
As Julia Gillard begins her campaign across western Sydney this morning to sell her plans for the new emissions trading scheme, the Prime Minister has told Australians petrol and agriculture will never be included in the cost of carbon tax.
"The only plan to add an additional piece to who pays for carbon pollution is to bring the heavy vehicles into the scheme," Ms Gillard said on Sunrise today. "There will be no carbon tax on petrol or agriculture ever."
Struggling Sydney families will bear the brunt of the tax, which will increase electricity bills by 10 per cent, gas by 9 per cent and the cost of food and groceries by almost $1 a week.
The government will embark on a $15 billion spending spree today to compensate low-income earners but almost 2 million households will still be out of pocket. "We are asking those families to do their bit to combat climate change," the Prime Minister said.
"Overwhelmingly Australians believe in climate change...and overwhelmingly they want the government to act. "Putting a price on carbon is the cheapest way of cutting pollution and that's why we have designed the scheme the way we have."
Despite the increases, families have been promised they will "forever" be safe from paying more for petrol because of the new tax.
Eight million Australian households will receive cash assistance under a carbon tax - but middle-income Sydney families will bear the burden. Ms Gillard admitted yesterday about 700,000 households would receive no compensation or tax cuts to cover an average $10-a-week rise in the cost of living.
It came as the Prime Minister announced an ambitious new target to reduce Australia's carbon emissions to 80 per cent below 2000 levels by 2050.
The major reform to the marginal tax rates will be to cover an estimated 10 per cent price rise in electricity bills, a 9 per cent rise in gas, and food and grocery rises of less than $1 a week as a result of a $23 charge for every tonne of carbon produced by the country's top 500 polluters. Airfares will also rise, with the aviation fuel excise to be increased.
The overall compensation package will end up costing more than the revenue from the tax for the first four years.
There are clear winners. Amid a complex arrangement of changes to the tax and family payment systems, a new clean energy supplement will provide pensioners with a 1.7 per cent rise, or $338 a year extra.
And $1.5 billion in payments will be made before the tax even kicks in on July 1 next year. Families who qualify for Family Tax Benefit Part A will receive an extra $110 per child. About 280,000 self-funded retirees who are Commonwealth Seniors Health Care Card holders will get the same amount of help as age pensioners.
The tax changes will come by tripling the tax-free threshold from $6000 a year to $18,200 a year [Itself a long overdue reform], which will mean almost four million low-income earners come out in front with the addition of a 20 per cent buffer payment over and above the tax rises.
But the sting comes for almost two million households which will end up out of pocket, being only partially compensated for a 0.7 per cent increase in the cost of living - or receiving no assistance at all.
The compensation package will leave a double-income family in Sydney with two children earning $120,000 of combined income $400 a year out of pocket after tax cuts due to cost of living rises of about $700 a year.
Dual-income $150,000 families with two kids will be $506 worse off under a carbon regime. A single-income family on $65,000 a year with a child under five will also end up worse off.
"We have made choices based on who needs assistance the most. Tax cuts and assistance have been pitched at families earning less than $150,000," Ms Gillard said. "What that means is there is no money tree ... there is no endeavour to try and pretend that everybody will be better off or everybody is in the same position.
"There are some Australians who are not getting tax cuts and family assistance sufficient to compensate them for the likely impact of carbon pricing on them. "We have structured it deliberately so we are assisting lower-income families and middle-income families ... putting assistance where it is needed the most."
The carbon tax will begin at $23 a tonne from July 1, rising to around $25 a tonne by 2015 when the tax converts to an emissions trading scheme (ETS). The government admitted the price could hit $50 a tonne under an ETS, depending on world prices.
Climate Change Minister Greg Combet said the environmental benefit would see more than 50 million tonnes of carbon cut by 2020 - the equivalent of taking 45 million cars off the road.
To achieve its long-term goals, the government will have to buy 100 tonnes of carbon abatements from Europe to meet its targets.
About 500 businesses will be forced to pay for their pollution, from which more than half of the revenue raised will be spent helping Australian households.
The government said it would also negotiate the closure of some of Australia's worst polluting electricity generators before 2020 and replace them with cleaner energy.
Opposition Leader Tony Abbott said millions of Australians would be worse off under the tax: "You have to ask yourself, what is the point of all of this? It will drive up prices, threaten jobs and do nothing for the environment."
The rest at AUSTRALIAN POLITICS