The ACCC has greeted the repealing of the so-called Carbon Tax by warning wholesalers and retailers of their legal obligation to pass through savings caused by this removal onto the customer.
The Prime Minister Tony Abbott said on ABC TV's 7:30 program last night (Thursday 17 July 2014) that the Government anticipates a saving of $550 per household in the first 12 months as a result of the Carbon Tax's repeal, which is being backdated to 1 July 2014.
"Businesses [that] supply regulated goods — electricity, natural gas, synthetic greenhouse gases (typically refrigerant gases) or synthetic greenhouse gas equipment (such as refrigerators and air-conditioners) — will be required to pass through all of the cost savings, direct and indirect, that are attributable to the carbon tax repeal," the ACCC said.
ACCC chairman Rod Sims said there would be serious repercussions for those businesses not complying.
“When the new law takes effect and the carbon tax is repealed, these businesses must pass through all cost savings from the carbon tax repeal,” he said. “If they fail to do so, the ACCC will take enforcement action against them and seek serious penalties from the courts.”
Punishments for businesses include fines up to $1.1 million per contravention and up to $220,000 per incident for individuals.
“When the new law takes effect and the carbon tax is repealed, these businesses must pass through all cost savings from the carbon tax repeal. If they fail to do so, the ACCC will take enforcement action against them and seek serious penalties from the courts.”
The Australian National Retailers Association, which primarily represents the interests of the two big supermarket chains, Coles and Woolworths, said supermarkets would be passing on savings.
“In a highly competitive market these major retailers will do the right thing," said CEO Margy Osmond. "Over the last few years, major supermarkets have worked hard to achieve savings for customers. This food price deflation represents a significant contribution to Australian households managing their cost of living pressures.
“Today’s outcome will go a long way in returning some certainty for business and consumers. Retailers believe confidence will begin to recover over the next six months.
"This will be assisted by a strong housing market, low interest rates and the prospect of more predictable processes in the Senate. Together, these will go a long way to stimulate a more positive outlook for consumers."
Meanwhile, following on from the Australian Retailer Association's chief Russell Zimmerman yesterday praising the repeal, saying that, "There is no doubt this boost to retailer’s bottom lines and the pockets of consumers will assist the sector to overcome pressures from excessive costs and be a boost to current low consumer confidence", the HIA, which represents the housing industry and builders, has welcomed the repeal:
“HIA has advocated against the Carbon Tax since its inception, as it represents yet another impost on one of the most heavily taxed sectors in the economy,” said HIA chief executive, industry policy and media, Graham Wolfe.
“The repeal of the tax was a key part of HIA’s 2013 federal election platform to help revive the housing industry. The Carbon Tax has had a direct impact on energy production costs, which in turn flowed through the manufacturing and fabrication phases of building material, product and assembly production.
“It has impacted on domestic manufacturing, jobs and material input costs in building new homes."
Harvey Norman chairman Gerry Harvey had been a vocal critic of the Carbon Tax, telling Eli Greenblat from the Sydney Morning Herald that Australia shouldn't be expected to lead the world on these policy issues.
''The bloke overseas is not doing it," Harvey said. "Whether it's right or wrong to have a carbon tax is one issue but whether it's possible is another issue."
''How can you do it? I'd love to be able to do it, but even if I do it it makes 1 per cent of 1 per cent difference to the world. Why am I doing this? Oh, because it's a good example to the rest of the world, oh, but then I go broke in the meantime.''
Taking an opposing view to this was Robert Manne, professor of politics at La Trobe University. He wrote in a scathing opinion piece for The Guardian that history will condemn those that sought the repeal of Carbon Tax:
History will condemn the climate change denialists, here and elsewhere, for their contribution to the coming catastrophe that their cupidity, their arrogance, their myopia and their selfishness have bequeathed to the young and the generations still unborn.