Virgin's carbon collision course

The carbon tax has cost Virgin Australia millions of dollars but done nothing to reduce the airline’s emissions. Tony Abbott and Kevin Rudd are right to abolish it.

Tony Abbott, and to a lesser extent Kevin Rudd, both realise the total absurdity of the carbon tax. That absurdity was transparent in Virgin Australia’s profit announcement this week. Virgin explained that the carbon tax had cost the airline between $45 million and $50 million – about half its loss.

When the Greens were asked to comment, they said that Virgin had always been anxious to reduce carbon. Of course, Virgin does want to reduce carbon – so does Qantas – but that abatement will take place via the development of more fuel-efficient planes in the US and Europe. Our carbon tax will have no effect on that abatement except to either push up fares or lower profits. And, of course, if it lowers profits too much it will make it difficult for Australian airlines to buy those fuel-efficient aircraft.

The carbon tax is simply a cost to Australians which contributes to our unemployment but does not affect the numbers in which people fly. Credit to both our politicians for waking up to the absurdity of the Greens. As we all know, Abbott will abolish the tax – and fast – if he wins. Rudd will effectively dramatically reduce it via an emissions trading scheme.

The ETS will send big sums overseas. If a low carbon tax had been used solely to foster research it might have had justification, but we used it to hand out social benefits.

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