Teals Federal MP Allegra Spender has thrown her support behind “carbon pricing” for Australia after leading economists proposed a fossil fuel tax.
Ross Garnaut and Rod Sims, who founded the Superpower Institute, propose a carbon tax known as the “carbon solutions levy” before 2031 that would raise more than $100 billion a year for clean energy.
Ms. Spender said broad tax reform is required, and this should include a carbon price and halting fossil fuel support.
“If we are going to reduce emissions at the lowest cost, we need to stop subsiding fossil fuels and consider how carbon pricing can help accelerate our transition.”
Mr. Garnaut and Mr. Sims, who addressed the National Press Club on Feb. 14, said the global transition to net zero is Australia’s opportunity.
“It’s essentially a transfer from fossil fuel companies to the 27 million Australian population. Basic economics means you must price the damage that fossil carbon imposes on us all,” Mr. Sims said during the address.
The economists suggested the “market failure” linked to carbon emissions could be corrected with a carbon solution levy at every fossil fuel extraction site and import port in Australia.
The levy would need to be implemented by 2031 at the latest, although bringing it in earlier would “unlock” cost-of-living benefits for Australians, the economists argued.
“Success requires investing 5 percent or more of our national income in the zero-carbon industries for several decades. That sounds impossible,” Mr. Garnaut said.
“Impossible, until we recall that we invested as much in mining during the China resources boom 2002-12.”
Mr. Sims said, “securing Australia’s place in a decarbonised global economic order is a once in a century economic opportunity.”
The carbon tax would be paid at the rate of carbon permits in the European Emissions Trading Scheme, and would be “administratively simple.”
“Rod Sims and Ross Garnaut have shown there’s a huge opportunity for tax reform that helps transform Australia into a green energy superpower and the lower cost of living for all,” she said.
“But if our tax system is fighting that, if we continue to for example as we do you know, spend around $8 billion dollars a year on fossil fuel subsidies through the diesel rebate, we are not putting all our resources actually to addressing climate change as we will.”
“And I think any economists, particularly Ross Garnaut, he is one of the eminent economists in this country, will tell you that if you have a broad price on carbon it will get you there (the) cheapest.”
However, Nationals leader David Littleproud said the carbon tax idea would “destroy resources jobs and our economy.”
Australian Treasurer Rejects Carbon Tax Suggestion
Federal member for Mackellar, Sophie Scamps, also a teal, asked Treasurer Jim Chalmers if he could back a carbon levy in parliament on Feb. 14.“Two of our nation’s most respected economists, Professors Sims and Garnaut, have today put forward a bold plan they say can lower global carbon emissions by at least six percent, would deliver much cheaper power bills, and would supercharge a new green export industry here, which would set up Australia’s prosperity in the new global economy for decades ... isn’t it time a carbon levy was back on the table?”
However, Mr. Chalmers said the government is “not up for the levy that Professor Sims and professor Garnaut proposed at the press club.
“Our plan includes lifting our country’s emission reduction targets from 26 percent to 43 percent. We’ve enshrined those targets and our net zero objective in law, which sends a message to renewable energy investors around the world that Australia has changed and is open to welcoming more investment in clean energy on our shores.”
