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Carbon tax ‘bad’

Friday, 16th September, 2011

Local Federal MP, Sussan Ley, addressed parliament yesterday on the proposed “carbon tax” and used a local business as an example of why it would, she said, be bad for far western NSW.

Ms Ley was speaking on the Clean Energy Bill 2011 and the associated 18 individual pieces of legislation. 

She said it would hit mining, agriculture, aviation and small businesses, and raise the cost of goods and electricity for ordinary people.

It was her job as an MP, the Member for Farrer said, to look at how the tax would affect her constituents, such as local man Peter Baxter.

“Peter Baxter runs a refrigeration business in Broken Hill and he cannot understand why he is being charged more for a refrigerant that charges up air conditioners or fridges with a gas that is not even discharged into the atmosphere,” Ms Ley told parliament. 

“A carbon tax, even at just $23 a tonne, will double his costs for refrigerant. That will then be passed on to the customer, adding about 10 per cent to the purchase price of refrigerators and air conditioners due to a gas that is not even discharged into the atmosphere. 

“He can already see the effect on his small business.”

Mining, transport and aviation would be “severely hit” by the tax, Ms Ley said.

“Mining is very important to the electorate of Farrer and iron ore mining is certainly picking up in the far-west of NSW. 

“Carpentaria Exploration are looking at mining leases along the NSW-SA border, and there is not a week that goes past that we do not see some new mining initiative talked about in the Barrier Daily Truth. 

“This is certainly a great thing for the region. It is going to support its economic activity for years to come. But if we are mining iron ore, particularly magnetite, we should, if possible, be doing the downstream processing of that iron ore in Australia. 

“We should not be exporting the raw material to Asia for further processing there. 

“I challenge anyone in this parliament to say that would be a good thing to do, but Australia’s largest magnetite producer is expecting to be out of pocket by $11 million by this government’s carbon tax and diesel fuel rebate.”

The company had said that because it processes the mineral in Australia they will be penalised in Australia because it value-adds here, “whereas if they export it overseas the same value-add process is not subject to a carbon tax,” Ms Ley said. 

“So why would they not do that? We cannot overlook the effect that this tax will have on the mining industry and on the resources sector in Australia.”

With aviation, Ms Ley said that Regional Express had said the tax will cost it $2 million in the first year. 

“That is $2 million that has to be added to the price of tickets because these costs are going to be passed on. They are not going to be able to be absorbed.

“The perplexing thing to Rex is that if the ultimate desire of the carbon tax should be that they modify their behaviour - in other words, that they emit less greenhouse gases - the only way they can do that is to actually not fly as much.”

Ms Ley told parliament she believed that the earth was warming, that human beings were contributing to that, and that we should be taking action. 

“I say we should be doing something, but not this (tax) and not now,” she said.

The way that the compensation message was being presented by the government was also confusing, Ms Ley said. 

“It is: ‘don’t worry; you will be compensated. There is not really a message in this to change your behaviour. 

“It is just such a distorted mess of movement of tax, of benefits to households, of charges on emitters, of people who are and are not affected and of costs that are going to be passed on that you cannot actually untangle the economic messages or the messages that households should be taking on.”

The Coalition’s “Direct Action” plan, in comparison, was “straightforward, easy to understand and practical,” Ms Ley said. 

“The primary facet of our direct action policy is capturing carbon from the soil. The Garnaud review, the CSIRO and even my friends in the Wentworth group and various state governments have indicated the enormous CO2 emissions reduction benefits of soil carbon for Australia.

“Submissions to the coalition from farm groups support the potential for a minimum of 150 million tonnes of CO2-equivalent per annum to be captured in soil carbon by 2020 and beyond with a payment to farmers of approximately $10 a tonne. 

“There are some good news stories about taking action on climate change. Unfortunately the government’s carbon tax is going to distort, destroy and negatively affect the Australian economy.” 

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