WHY IS OUTA CHALLENGING CARBON TAX?

The National Treasury has indicated it will implement another tax, Carbon Tax, early in 2018. Projections show this tax will add R13.7 billion to the fiscus in an effort to reduce Green House Gas (GHG) emissions threatening Climate Change.

While we support efforts which effectively reduce pollution and GHG emissions, we do not believe Treasury’s Carbon Tax initiative will help reduce GHG emissions in the medium to long term. The structure of this Carbon Tax, which is not ringfenced and directed to support or generate initiatives to combat GHG will, without a doubt simply disappear into the general tax pot.

Furthermore, we believe adding a Carbon Tax to the cost of business will not necessarily change behaviour (i.e. reduce an organisation’s emissions). The cost of a Carbon Tax will more than likely be passed onto the consumer.

If a new tax is not neutral in impact on society, does not change the behaviour it is intended to or is not used to secure a beneficial outcome for society in the areas the tax is applied, then it is an irrational, unnecessary. By all definitions, Carbon Tax is an unjust tax and should be challenged.

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