No one likes paying A$1.80 per litre for petrol. But amid forecasts of prices climbing to $2.10 as Russian’s invasion of Ukraine drags on, it’s possible some good could come of that pain – including greater energy independence and a faster path to net-zero emissions.
Two months ago, at the start of 2022, the typical Sydney and Melbourne unleaded price was $1.60 a litre. A year earlier, at the start of 2021, it was $1.20.
Overwhelmingly, Australia’s top economists would rather the budget funds measures to cut carbon emissions than cuts income tax or company tax.
They are also dead against rumoured cuts to petrol tax and the tax on beer.
The Conversation’s pre-budget survey of a panel of 46 leading economists selected by the Economic Society of Australia finds almost half want a budget deficit smaller than the A$99.2 billion expected for 2021-22 and the $98.9 billion forecast for 2022-23 in the December budget update.
Eight in ten of Australia’s leading economists back action to cut Australia’s carbon emissions to net-zero.
Almost nine in ten want it done by a carbon tax or a carbon price – mechanisms that were explicitly rejected at the 2013 election.
The panel of 58 top Australian economists selected by the Economic Society of Australia wants the carbon price restored to the public agenda even though it was rejected seven years ago, some saying Australia’s goods and services tax was rebuffed in 1993 and then restored to the public agenda seven years later.
Among those surveyed are former heads of government departments and agencies, former International Monetary Fund and OECD officials and a former and current member of the Reserve Bank board.
Ten years ago, in the lead-up to Australia’s short-lived carbon price or “carbon tax” (either description is valid), the deepest fear on the part of businesses was that they would lose out to untaxed firms overseas.
Instead of buying Australian carbon-taxed products, Australian and export customers would buy untaxed (possibly dirtier) products from somewhere else.
It would give late-movers (countries that hadn’t yet adopted a carbon tax) a “free kick” in industries from coal and steel to aluminium to liquefied natural gas to cement, to wine, to meat and dairy products, even to copy paper.
It’s why the Gillard government handed out free permits to so-called trade-exposed industries, so they wouldn’t face unfair competition.
The government’s decision to target net-zero emissions by 2050 will leave each Australian nearly A$2,000 better off by then compared to no Australian action.
That’s what we were told in a six-point summary of the government’s economic modelling released at a press conference on Thursday October 26, days before the prime minister left for the Glasgow climate talks.
