'Tip 3' for Direct Action: A levy without discrimation

A Coalition levy targeted at the source of all fossil fuel emissions would wipe out the inefficiencies and loopholes of Labor's approach.

This is the third part in a series of 'Tips for Direct Action'. Read the first part here and the second part here

Scrap the tax, axe the tax, ditch the tax - it's pretty clear that Tony Abbott and his climate prodigy Greg Hunt (who wrote a thesis called A Tax to Make the Polluter Pay) are planning on doing something about Julia Gillard 's carbon tax.  

Unfair tax

The real problem with the carbon tax is that it favoured a number of emissions intensive sectors of the economy over others. In particular, the net was not being cast wide enough to include those companies exploiting a loophole that allows them to sell their fossil fuels for burning overseas and thereby avoid paying the carbon tax here.  

Unaccounted for emissions

Under business as usual if all the serious LNG and coalmine plays got up Australia would be exporting fossil fuels that when burnt will be equivalent of 14 times our domestic emissions, or about 10 per cent of global emissions (a conservative estimate that doesn’t include updated fugitive methane factors).

The total of all the emissions sourced deep beneath Australian farms and forests will be greater than almost all the world’s economies, big and small. Only Russia, the US, China and India will be bigger, however, those economies are massive and we will be punching well above our weight - topping the polluter hall of shame as the economic costs and human misery from climate related impacts around the world mounts.

Taking direct action

Tony Abbott is promising a levy on 1500 of the wealthiest corporations to pay for his paid parental leave scheme. As levies are the Coalition’s accepted and preferred way of raising revenue it would be appropriate to swap the carbon tax and the mining tax for a levy on all fossil fuels based on their carbon content once they are combusted at the mine. This would mean there would be fewer companies to collect from and they would be the companies at the source of the problem. For example, BHP Billiton would pay a levy of about $25 for fugitive and plant emissions at its Mt Arthur mine, similar to their liability under the carbon tax - but, of course, it would be a levy and not a tax. They would also pay for all the emissions that would occur from the combustion of the coal they are selling, no matter where it would be burnt. This would mean that we would not be discriminating against Australian companies that burn Australian coal and gas here in Australia versus foreign companies that choose to burn our coal and gas offshore. A fair levy for all.

Oh, and Greg Hunt wrote this in his university thesis:

“Ultimately it is by harnessing the natural economic forces which drive society that the pollution tax offers us an opportunity to exert greater control over our environment."  

But I’m sure he meant a levy.

Time is of the essence

We've got to hit the problem at the source and do it fast (in Abbott’s first legislative period) to avoid the long lasting effect of more CO2 entering the atmosphere as it lasts 500-1000 years and we've been out of balance on the dangerous climate seesaw since we passed 350ppm in Australia’s bicentennial year.

Along with the previous direct action policy discussed ('Tip 2' for Direct Action: Ending the fossil fuel licensing loophole, September 16) which simply involves the federal Abbott government pulling the states into line enforcing a cessation of the issuance of new fossil fuel (coal, gas, oil, CSG and shale) exploration and extraction licences, this policy will avoid window dressing and go directly to the heart of the problem and deal with it decisively at the source, once and for all. And that is the kind of approach we would expect from a decisive conservative government that hasn't got its tail between its legs and wants to roll up its sleeves and tackle the biggest challenges facing the country, the biggest of which is global warming, head on.

Matthew Wright is the executive director of Zero Emissions Australia.

Note from the author: As we all know, the Liberals have been heavy on campaign rhetoric, which is all very well when you are in opposition. But being absent and underweight in deliverable policy doesn't fly when you're in government. When it comes to climate rhetoric Abbott and his protégé Hunt are in their element.  Every time Hunt fronts a camera he is mouthing direct action, but now he has to front the house with a deliverable. I know he is short, so I'm here to help in turning direct action rhetoric into deliverable action. These tips aim to provide meaningful and measurable infrastructure on the ground that will make a difference and beat Labor and the Greens at their own game.