ELECTRICITY companies will have to refund at least $100 million to households in carbon tax charges if the government succeeds with its repeal next week.
Most electricity retailers have continued to charge the carbon tax, which costs $11 million a day on electricity, since July 1 rather than take a risk on a quick repeal of the measure.
With the repeal backdated until July 1 no matter when it passes, this means the carbon tax will have to be repaid to households.
The repeal will see the price of electricity fall by about 9 per cent and gas by about 7 per cent. It is predicted to cut the consumer price index by 0.7 per cent.
Businesses that use off-road diesel will also receive a 6.5c-a-litre cut in fuel prices that will benefit the mining and manufacturing sectors, however, airline passengers are unlikely to see lower fares because the existing price war has already cut prices to the bone.
It will be cheaper to use some landfills, and air-conditioning gases are also likely to be cheaper, although the gas price change will take time to work through the system as the carbon tax will still apply on goods imported before July 1 but sold afterwards.
The government has agreed to Clive Palmer’s demand that the repeal legislation guarantees a full refund for consumers.
Yesterday, a new row erupted over the carbon tax repeal, the government’s Senate Leader Eric Abetz accusing Labor and the Greens of refusing to participate in an Environment and Communications Committee meeting to sign off on a report that must be tabled before the repeal vote can take place.
Labor is adamant the debate cannot start before July 14, when the Senate had originally agreed the committee would report. The issue is likely to start a new row in the Senate next week as the government tries to bring on the vote.