Carbon tax repeal impact on cost of living remains unclear

Estimates on energy savings vary widely
 
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01.Savings estimates vary but energy bills could fall

Savings following the end of carbon pricing remain to be seen.

The carbon tax has been repealed by the Senate but how much consumers will save as a result remains unclear. 

The legislation will take effect retroactively, meaning consumers should see any additional carbon tax costs come off their bills dating back to 1 July. But estimates of significant annual savings on energy costs have been roundly contested. 

"It's adding nine per cent to your power bills, it's a $9 billion handbrake on our economy and it's costing average Australian families $550 a year,” Tony Abbott recently told the Queensland Liberal National Party convention, as Fairfax media reported

But less than half that saving would reportedly come off power bills. The rest would be divided between food, clothing and rent.

The average Queensland family will save about $170 a year off their household electricity bill, Queensland Treasurer Tim Nicholls and Energy Minister Mark McArdle said in a joint statement. 

Food and grocery prices

Woolworths has said the repeal of the tax won’t lower food prices in its stores because it didn’t raise prices when the tax was introduced. 

And Coles has said it is "working with suppliers to understand the implications of the change and if we identify any savings attributable to the tax changes we will pass them back to our customers".

Qantas won't lower fares

Qantas says it has gotten rid of the carbon tax surcharge on domestic flights but won’t be lowering standard fares, as CHOICE reported recently. 

The Climate Institute says savings estimates reported in the media are probably overblown. 

Labor to push for ETS

The price on carbon may be gone, but opposition leader Bill Shorten has indicated that Labor will push for an Emissions Trading Scheme at some point in the future and make it a campaign issue. 

CHOICE believes businesses should reduce their charges by the same amount that was added due to the introduction of the carbon tax. 
 
 

 

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