Prime Minister "determined" to extend carbon tax to trucking to make sure road, rail and shipping compete on even ground
By Brad Gardner | September 15, 2011
Prime Minister Julia Gillard says she is “determined” to apply a carbon tax to the trucking industry to make sure road, rail and shipping compete on even ground.
Despite calls from the trucking lobby for the industry to be exempt, Gillard told Parliament yesterday her government would extend the scheme to heavy vehicles through reductions in the fuel tax credit rate.
The industry has been granted a two-year exemption from the carbon tax and will pay an extra 6.85 cents per litre for fuel from July 1, 2014. The government introduced its carbon tax bills into Parliament this week.
“The government does intend to apply an effective carbon price to fuel use by heavy on-road transport from 1 July 2014,” Gillard says.
“We intend to do that because we want to ensure that there is competitive neutrality between the various ways that goods are moved around the country. Rail, domestic shipping and domestic aviation face an effective carbon price, so we believe that the alternative way of moving goods around should also face an effective carbon price.”
The carbon tax will apply to the rail and shipping industries from July 1, 2012.
While independents Rob Oakeshott and Tony Windsor, who were involved in the multi-party talks on the tax, opposed a carbon price on the trucking industry, Gillard says her government is “determined that such an arrangement would come into force on 1 July 2014.”
Treasury modelling claims household costs will rise by around 0.05 percent when the tax is applied to heavy vehicles and passed on.
Much of the revenue from the carbon tax will be funnelled back to households in the form of assistance and tax cuts.
Gillard says the assistance package factors in the impact the tax will have on households when it is applied to trucking operators.
“So although the household assistance package will, of course, come into effect prior to the introduction of that change for heavy vehicles, the 0.05 percent has been taken into account,” she says.
Gillard’s comments came in the wake of strong criticism from Opposition leader Tony Abbott, who claimed the tax was based on a lie and should be rejected.
Abbott says the Prime Minister, who before the 2010 election said she did not plan to introduce a carbon tax, should take the policy to the people to vote on.
“This is a transformational change. This is something which is supposed to impact on our country, not just today, not just next year, not just next decade but forever,” he says.
“She should be taking this to the people.”
Abbott, who favours paying companies to reduce emissions under his ‘direct action plan’, says businesses should be encouraged to reduce their carbon footprint rather than paying a tax.
“Australian businesses are taking sensible measures to reduce their fuel bills and reduce their power bills. Linfox has better trained its drivers and as a result of better driver training their total emissions have reduced by 35 percent since 2007,” he says.
Calare MP John Cobb claims the transport industry in his electorate “will be absolutely hammered” under the tax and there is a strong opposition to it.
“The numerous truck owner-drivers through the transport industry will not be hit by this for a couple of years but, my heavens, they probably are the wildest of all those who have to face this tax,” he says.
Treasury modelling released in conjunction with the announcement of the carbon tax in July predicts slight cost increases, but stresses that global inaction on climate change will be more expensive.
Treasury also expects biodiesel will eventually supplant diesel as the most common fuel powering heavy vehicles.