Questions remain over govt carbon repeal

Greg Hunt (L) says legislation to repeal the carbon tax will ensure it takes effect by July 1 2014. Source: AAP

DOUBTS have emerged over federal government plans to repeal the carbon tax, after Environment Minister Greg Hunt avoided saying whether the legislation would be retrospective if it wasn't passed on time.

Labor and the Australian Greens won't support the repeal bills, although Labor does agree the fixed carbon price should go - but only if it's replaced with an emissions trading scheme (ETS).

This means the government's goal to see the bills passed through the upper house and the carbon tax scrapped by the end of this financial year will be more difficult to achieve.

While Prime Minister Tony Abbott says he is confident the Labor opposition will buckle under pressure to axe the tax, it's not clear what will happen if it isn't repealed as planned by June 30.

Environment Minister Greg Hunt says the repeal legislation made it very clear the final compliance year for companies to pay the fixed price carbon tax of around $24 per tonne will be 2013/2014.

Asked if businesses may be liable to pay if the bill didn't pass the Senate until after July 1, Mr Hunt said "the tax ends on June 30, 2014, the moment that legislation is passed".

"We're getting way ahead of ourselves. It is designed to take effect under every circumstance from the evening of 30 June 2014," the minister told ABC Radio on Wednesday.

"We cannot take away the tax without legislation being passed, but this legislation is designed for every circumstance.

"The ALP has attempted to prevent any change. We will not stop until the legislation passes."

The minister's decision not to provide details of what would happen after July 1 came as the business community voiced its own concern.

Australian Industry Group chief Innes Willox said uncertainty about what would happen from July would "cause greater uncertainty for business around investment".

"If it meanders beyond the 1st of July, that's going to create uncertainty for business about liabilities, what happens with ongoing grants," he said.

Acting Labor climate change minister Mark Butler created confusion about the opposition's stance on the repeal bill, after telling Sky News it agreed "with Tony Abbott on the repeal of the carbon tax".

He was referencing plans by the former Rudd government to move earlier from a fixed carbon price to a floating price ETS in July next year.

Some Labor MPs are using this to argue the party doesn't disagree with getting rid of the fixed carbon price.

"The question is, what is put in its place," Mr Butler said.

Greens leader Christine Milne accused Mr Butler of "continuing to play games" with words.

The government may have a better chance of getting the bills passed in the Senate after July 1, when the change-over of upper house MPs takes effect.

It will need to win over Clive Palmer's voting bloc of four, plus two of three conservative crossbenchers from either the Liberal Democrats, Democratic Labor Party or Family First.

All have supported the principle of abolishing the carbon tax.

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