- A carbon tax will be imposed on all facilities producing 25,000 tonnes or more of greenhouse gas emissions in a year.
- The tax will be $5 per tonne of greenhouse gas emissions from 2019 to 2023, and the rate will be reviewed by 2023.
- The intention is to reach a carbon tax rate of between $10 and $15 by 2030.
- $1 billion is expected to be collected in carbon tax revenues in the first five years, and the Government is prepared to spend more than this amount to support emissions abatement projects.
- Funds have been set aside to enhance support for companies to improve energy efficiency through schemes such as the Productivity Grant (Energy Efficiency) and the Energy Efficiency Fund.
- While the headline rate of $5 appears low as compared to some other developed countries like UK or the countries in the EU region, the cost will likely be passed on to all end-users. Businesses should identify opportunities for reducing emissions along their value chain and also leverage on government grants for energy assessments, as well as incentives for energy- efficient technology and equipment.