Carbon tax set for repeal next week

THE carbon tax repeal legislation could be put before the Senate as early as next Tuesday.

THE carbon tax repeal could be put before the Senate as early as next Tuesday pending an agreement between the government and Clive Palmer on a law to guarantee all savings are passed on.

While confidence is growing in government ranks on the carbon tax repeal, Greens leader Christine Milne said she would seek meetings with crossbench senators to save the tax and Bill Shorten reaffirmed Labor’s support for an emissions trading scheme.

The Australian understands that the government and the Palmer United Party are looking to settle as soon as possible on the clause to guarantee the full savings from repealed carbon tax are passed on to consumers.

The legislation on Mr Palmer’s demand is likely to create a law to require electricity companies to prove to the consumer watchdog that 100 per cent of the carbon tax has been passed back if there is any prima facie doubt.

The negotiations come as the Australian Financial Markets ­Association’s electricity committee agreed that the carbon tax would be removed from any electricity market derivatives traded between yesterday and July 18.

This means that electricity ­derivative contracts sold during this period and using the AFMA carbon addendum will not incorporate a $25.40 carbon tax.

These savings can be passed on to electricity consumers without the need for any retrospective refund. Electricity market derivatives account for an estimated 30 per cent of electricity bought and sold in Australia.

Tony Abbott said yesterday he was not taking the repeal for granted but “I expect all of the crossbench senators to be true to their pre-election commitments’’.

The Prime Minister said the repeal would be the first significant item of business for the new Senate, which sits next week.

The Opposition Leader said Labor would continue to support an ETS, the position it took to the election last year.

Senator Milne said she would meet with all crossbench senators to save the existing carbon pricing system.