Amazulu

This is a really bad policy. A better one would have been a national dental scheme - which would be insanely popular, and probably cheaper.

lapin_windstar

1) But how do you simultaneously argue that it's going to be ruinously expensive because of the high tax imposed on the emitters but also that it's a "licence to steal" given to the emitters by the government?

2) The incentive to change to greener alternatives in production is that the emitter won't have to pay so much carbon tax if they do. Instead of being prescriptive, the government is - wisely - leaving it up to the market to decide what the best way to achieve that is on the basis that they know their business best. Not complicated, surely?

knockoff nige

1) That would assume that they will put their prices up without 'rounding it off to the nearest $'

2) That's not an incentive when the cost of this gets passed onto you and me.

Correct, not complicated.

anawanahuanana

But why should they care how much tax they pay if they just recoup it from further down the line. Surely it's cheaper for them just to up their prices instead of investing on renewable alternatives?
The money the govt. makes from the tax then gets pushed back on all but the "high income earners" to pay for their out of pocket costs, so no incentive there for the general population to reduce their energy use etc. In fact the only people, according to the government, who will be out of pocket due to the carbon tax are the wealthy and do you really think they care that much if their electricity bill goes up by 50 bucks a quarter?
It's hardly a revolutionary scheme but the govt makes out it'll save the planet.....

Broad Shoulders

...simply because the cleverer companies will begin to twig that by cutting their carbon emissions they cut their costs. Any company CEO worth his salt looks at ways to cut costs to increase profitability. Sooner or later one company will realise that if they cut their emissions and therefore cut their tax costs they can be cheaper to market than those who choose to simply up their consumer price.

knockoff nige

But they'll put the prices up anyway

Broad Shoulders

not the clever ones. Market economics is full of companies who look to compete on price alone, this is yet another example of it. The way companies compete on price is by having a lower cost structure than others. How can companies achieve this under the carbon tax? By lowering their emissions. It's not rocket surgery

knockoff nige

Yes, typically thats how it works. Some day this common sense will make its way to Australia.

lapin_windstar

I'm not sure that ^^^ makes any sense at all.

They're in a competitive environment. They can't just blindly pass it onto their customers without losing sales to the first competitor that produces in a more efficient, tax-minimising way or losing sales to substitute/alternative products.

Broad Shoulders

my point exactly

knockoff nige

But greener doesn't mean cheaper. You're assuming they will save money by moving to greener alternatives. They're will atleast be an initial cost to moving to alternatives. You'll be charged the cost of that.

Broad Shoulders

...and you might well find that the cost to move to greener alternatives is cheaper than paying the equivalent in carbon tax. Your entire argument is based around the entire premise that all companies will just lay down and accept the tax and pay it and do nothing about it. I can tell you first hand that for the last 6 months alone our company has been approached by countless companies looking at ways in which they can reduce their emissions.

anawanahuanana

Maybe I'm just too cynical then but nothing "good" (free range meat, organic foods, renewable energy etc) is cheaper than the "bad" alternatives, which is why they are still so popular. If there was a way for company X to be creating whatever they do in a cheaper way, more environmentally friendly or not, they would be doing it. People are making the assumption that by investing God only knows how much in technology to reduce their CO2 output and paying a lower carbon tax, the increased cost to make this reduction will be less than the cost of paying the tax allowing them to lower the price charged to the consumer.
Nobody knows for sure when and if that will happen.

knockoff nige

Well this I agree with entirely. I'm sure some companies will and have been actively looking for greener alternatives but many of them are forced to maintain prices because of their suppliers not budging. If it was as simple as everyone changing, we'd be alot further down the line. Long term contracts between businesses will mean that if there will be a lower cost, we won't see it for some time.

calliope

I'm sure you don't.