Rudd backs away from introducing stringent emissions trading scheme, but will introduce a new fuel credit rebate system
By Brad Gardner
The Rudd Government has backed away from introducing a stringent emissions trading scheme, but will introduce a new fuel credit rebate system.
In releasing the Government’s white paper on a proposed 2010 Carbon Pollution Reduction Scheme (CPRS), Prime Minister Kevin Rudd announced a five percent cut of 2000 levels by 2020.
To offset any costs the scheme may have on the trucking industry, the Government will freeze the excise for one year to ensure heavy vehicle operators can claim current fuel tax credits.
“The Government will introduce legislation to implement a new CPRS fuel credit scheme for one year for businesses in heavy on-road transport,” the white paper says.
“To minimise the compliance burden for eligible businesses, the Australian Taxation Office will administer the CPRS fuel credit, and businesses will claim it on their business activity statements.”
Small businesses will also share in $2.5 billion to help them adapt to the scheme, while the Government has increased the amount of free permits to trade exposed industries.
Rudd maintains the Government is taking decisive action to reduce climate change, and it will look at cutting emissions by 15 percent of 2000 levels if the world reaches an agreement on climate change.
He has also committed to reducing emissions by 60 percent by 2050.
Treasury modelling predicts a one-off rise in inflation of 1.1 percent when the scheme is introduced and 0.1 percent drop in growth from 2010 to 2050.
Emissions trading will introduce a $23 impost on a tonne of carbon and will cover 75 percent of Australia’s emissions, including transport, energy and waste sectors.
Agriculture will not be included, and the Government will look at including it by 2015.
Households will also receive some $6 billion in handouts a year to cope with any cost increases.
But the Government’s plans may run into trouble when it introduces legislation into the Senate, with the Greens pushing for a 40 percent cut in emissions by 2020.
Greens leader Bob Brown has labelled Rudd’s scheme “a global embarrassment and a recipe for global catastrophe”.
Brown says the Greens will initiate a senate inquiry and make amendments to legislation.
Greens climate change spokeswoman Christine Milne says half of the money raised by the scheme will go back to heavy polluters, while only 3 percent of funds will be devoted to reducing emissions.