From Australia (RW): The Australian Parliament has repealed the 2014 carbon tax legislation on CO? emissions.

The legislation, which imposed a tax of A$24.15/t, was passed into law by the previous Labor government in 2011. When in opposition, the Conservative coalition—of the Liberal and National parties led by now Prime Minister Tony Abbot—vowed to repeal the tax if elected. This pledge was a major plank in his election manifesto.

The repeal legislation easily passed the House of Representatives where the government has a majority, but it took several attempts to pass the Senate where mining maverick turned politician Clive Palmer’s Palmer United Party senators hold the balance of power.

Long debate
After some 40 hours of debate and an amendment imposed by PUP, the repeal legislation finally passed through the Senate early last Thursday morning on a vote of 39 to 32. The amendment stipulates that companies pass on all savings to consumers by July 2015 or face a fine equivalent to 250% of what they have saved.

Prime Minister Abbott labeled the tax “a useless, destructive tax which damaged jobs, which hurt families’ cost of living and which didn’t actually help the environment.” Abbott added that his government planned to replace the tax with a taxpayer-financed A$2.55 billion fund to pay industry incentives to use cleaner energy.

The Australian Petroleum Production & Exploration Association CEO David Byers said the repeal of the carbon pricing mechanism was significant as it removed a cost facing Australian LNG exporters competing in global markets. He said it was a cost that did not exist for Australia’s international competitors.

The tax has been controversial from its inception. The original carbon tax, brought in by Prime Minister Julia Gillard in 2011 under pressure from the Greens—after she initially vowed not to—required Australia’s top 500 polluting companies to pay a price on carbon emissions from July 2012.

It formed a central plank of the Gillard government’s environmental commitment to cut carbon emissions by 5% of the 2000 levels by 2020.

The regime began with a fixed price of A$23/t on carbon imposed from 1 July 2012, set to rise 2.5% a year in real terms for three years. It was planned to transform the tax into an emissions trading scheme with a floating price in mid-2015 with a floor of A$15 and a ceiling of A$20 above the expected national price to prevent volatility.