Tuesday, March 13, 2012
Australian growth hit 30 billion dollars by Carbon Tax
Australia's decision to go it alone with a fixed $23 per tonne carbon tax will cost the country $30 billion if overseas prices stay at around $10 as predicted according to economic modelling. With falling global temperatures this tax equates to economic self-mutilation with all pain and no gain. The same modelling says that the Coalition alternative policy will not achieve it's aims either.
The modelling, by the Centre for International Economics consultancy, warns that keeping the $23 fixed price regime and the floor price of $15 a tonne - key elements of the current package - will have almost twice the impact on economic growth by 2018 as allowing the Australian price to track international prices.
A higher price in Australia than in comparable international markets could also cost the mining industry a cumulative $4bn and durable manufacturers $1.5bn over six years, the CIE modelling predicts.