Isra-Mart srl : Families 'better off' with carbon tax plan

www.isra-mart.com

Isra-Mart srl news:

THE Federal Government has promised that millions of low and middle income families will be better off financially under its plans for a carbon tax.

More than half the funds raised by the Gillard government's carbon tax will be used to pay for permanent tax cuts and pension hikes under a plan to be outlined on Wednesday.

In a bid to turn around widespread concern that the tax will hit family budgets, Climate Change Minister Greg Combet pledged that more than two million households will be better off under the related tax and welfare changes.

Compensation for families will be in place permanently, even after the carbon tax is replaced by an emissions trading scheme in three to five years, Mr Combet said.

The pledge comes as Treasury models revealed average family bills could jump $860 a year based on a $30 a tonne carbon tax.

Start of sidebar. Skip to end of sidebar.

End of sidebar. Return to start of sidebar.

The Government plan has not been signed off on by the multi-party climate change committee including the Greens and independent MPs Rob Oakeshott and Tony Windsor.

Mr Combet will use a National Press Club speech in Canberra on Wednesday to outline the Government's plans to win over voters. In an excerpt from his speech, Mr Combet vowed "we will put households first".

"There will be generous assistance for households to meet costs that may be passed on by the companies that are paying for their pollution," he said.

The minister said he "can assure you" that half the carbon tax revenue would be used to fund permanent assistance for millions of households.

The compensation plan could be larger than a similar package under former prime minister Kevin Rudd's now dumped emissions trading scheme that would have left 2.9 million low-income households better off.

Modelling for the previous plans suggested low-income households would have been $190 a year better off .

The Gillard government may have the scope to offer larger assistance measures depending on the carbon price, which is likely to be set at $20 to $30.

The carbon tax could raise $12 billion in the first year it is introduced from July 2012, government climate change adviser Ross Garnaut has suggested.

Professor Garnaut has called for half the revenue to be funnelled into income tax and welfare changes.

But the Government is unlikely to adopt his proposal to fund a massive overhaul of the tax and welfare system, Labor sources said.