The program outlined by the Gillard Government yesterday, is generous, that's for sure. I think there is an attempt to ensure most Australians and businesses will feel very little impact of the carbon tax with compensation covering most pain.
Points of interest:
- 4 million Australian households will come out 20 per cent ahead… (they’ll get 20 per cent more compensation that what their costs will go up).
- 2 million households will have their costs covered.
- 2 million households will make a loss because they won’t be fully compensated. (I think I'm one of those!)
- 700,000 of the richest households won’t get any compensation at all.
THE CARBON TAX
- $23 a tonne
- for average households costs will increase $9.90 a week but compensation will be $10.10
- 9 out of 10 households will receive assistance… and 2 out 3 of those households will receive enough to cover the extra costs.
- 500 companies and 3 million households will be worse off.
- aim is to reduce emissions to 5 per cent below year 2000 levels by 2020 and 80 per cent below 2000 levels by 2050.
- electricity generates a third of our emissions.
ECONOMY
- Budget will take a $2.68 billion hit this year and $400-500 million/yr over next 2 years.
- will add 0.7 per cent to the CPI in it’s first year… the GST added 2.5 per cent.
- electricity prices may go up 10 per cent, gas may go up 9 per cent.
- will slow average income growth 0.1 per cent a year… the ageing population will slow income 0.3 per cent.
TAX BENEFIT
- tax free threshold tripled to $18,200 a year from July 1, 2012.
- regular wage earners below $18,200 will have no tax withheld.
- 1 million Australians will not have to lodge a tax return.
- but middle tax rate ($37,000-$80,000) will rise from 30-32.5 per cent… to stop over $150,000 earners getting a benefit
- all taxpayers under $80,000 a year will pay less tax.
- no Australians will pay more tax
FAMILIES
- with 2 children will up to $220 in extra Family Tax Benefit A and other families will get $110.
- extra $69 in Family Tax Benefit Part B
SENIOR AUSTRALIANS
- pensioners and self funded retirees will get up to $338 a year for singles and up to $510 a year for couples.
- will get lump sum advance of $250 in May-June 2012… basically getting 9 month payment in advance.
- 90 per cent of pensioners will make a profit… receive more compensation than be hit with extra costs
- Commonwealth Seniors Health Card (mainly self funded retirees) will get the same assistance as pensioners.
- Self funded retirees will get benefit of increase in tax free threshold.
SINGLES
- get the tax cuts.
- People on Assistance will get $218 for singles up to $390 for couples.
SMALL BUSINESS
- small business instant asset write-off threshold will rise from $5000-$6500
- no extra paperwork
- no compensation for increase in electricity costs … go up 10 per cent.
NEW FUNDING
- $10 billion Clean Energy Finance Corporation
- $3.2 billion Australian Renewable Energy Agency
- $200 m Clean Technology Innovation Program
Source for most of this info came from (http://www.kochie.com.au/20110710419/your-guide-to-the-carbon-tax-and-compensations), which I thought was one of the only simple, relatively independent analysis I could find so far.
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