National Treasury forges ahead with carbon tax plans
03 November 2015
Posted by: Author: Ingé Lamprecht
Author: Ingé Lamprecht (Moneyweb)
Draft bill published for public comment.
National Treasury has signaled its intention to forge ahead with the introduction of a controversial carbon tax, with the publication of a draft bill on Monday.
It said however that it has taken the current state of mining and other distressed sectors into account. The combined effect of the exemptions in the carbon tax and the reduction in the electricity levy "will be designed to ensure that such sectors are not adversely affected when the carbon tax is implemented”.
"The tax and revenue recycling measures are also designed to be revenue neutral from a macroeconomic perspective, but will not necessarily be neutral for (scope one) companies with significant emissions.”
A reduction in the electricity level is one of the recycling measures proposed.
The carbon tax will especially affect those that use a lot of energy. During the last two years of the current consultation process, which started in 2010, there have been concerns that the introduction of a carbon tax could cripple those industries that are already struggling with competitiveness issues. Some industry commentators have also been skeptical about the ability of a green tax to change behaviour and said the South African economy – which is built on coal – is not yet in a position to offer the alternative technologies that could facilitate a switch to cleaner energy.
Initial proposals were for the carbon tax to be introduced on January 1 this year, but it was pushed out to 2016 during the 2014 February budget.
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This article first appeared on moneyweb.co.za.