9th Jul 2014, 11:51 AM – Senate Clean Energy (Income Tax Rates and Other Amendments) Bill 2013 [No.2] - Second Reading - Read a second time

This division relates to the Policy For a carbon price.

The majority voted against a motion "that the Clean Energy (Income Tax Rates and Other Amendments) Bill 2013 [No.2] be read a second time."(Read more about the stages that a bill must pass through to become law here. ) This means that the majority disagreed with the bill and that it was rejected.

This bill was introduced to repeal legislated changes to the tax-free threshold, tax rates and tax offsets for individual taxpayers which will otherwise occur from 1 July 2015.(Read more about this bill in its bills digest and the bills digest for the previous version of this bill, called the Clean Energy (Income Tax Rates and Other Amendments) Bill 2013. ) These measures had been introduced by the previous Labor Government to compensate for any increased housing costs that may occur under the floating carbon price. The Liberal Government argued that "without the carbon tax, the tax cuts are not necessary".(Read more about the income tax measures on ABC News here. )

Background to the bills

The Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 (No. 2) was introduced along with the Clean Energy (Income Tax Rates and Other Amendments) Bill 2013 [No.2] and other related bills to remove the carbon pricing mechanism, which was introduced by the Australian Labor Party while in government. The Coalition described the mechanism as a “carbon tax” and removing it was a key policy platform during the 2013 election.(You can read more about the Coalition's policy to remove the carbon price here. )

The carbon pricing mechanism commenced on 1 July 2012.(For more information on the carbon pricing mechanism and how it works, please see the Clean Energy Regulator’s website. ) It is an emissions trading scheme that puts a price on carbon emissions. It applies to “liable entities” (a group that includes companies that emit a high level of greenhouse gases). Initially the price of carbon is fixed by the mechanism but from 1 July 2015 the price will be set by the market, though the Labor Government did announce plans to bring this forward to 1 July 2014 just before they were defeated by the Coalition in the 2013 election.

This is the second time that this package of bills has been introduced, after they were rejected in the Senate during the third reading stage the first time round.(See that division here.)

The other related bills that were introduced along with the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 (No. 2) are:

• Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Amendment (Carbon Tax Repeal) Bill 2013 (No. 2);
• Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Amendment (Carbon Tax Repeal) Bill 2013 (No. 2);
• True-up Shortfall Levy (General) (Carbon Tax Repeal) Bill 2013 (No. 2);
• True-up Shortfall Levy (Excise) (Carbon Tax Repeal) Bill 2013 (No. 2);
• Ozone Protection and Synthetic Greenhouse Gas (Import Levy) (Transitional Provisions) Bill 2013 (No. 2);
• Customs Tariff Amendment (Carbon Tax Repeal) Bill 2013 (No. 2);
• Excise Tariff Amendment (Carbon Tax Repeal) Bill 2013 (No. 2);
• Clean Energy (Income Tax Rates and Other Amendments) Bill 2013 (No. 2);
• Climate Change Authority (Abolition) Bill 2013 (No. 2).