Melissa Price (Durack, Liberal Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer outline how repealing the carbon tax will help build a stronger economy? What would be the impact of the carbon tax on growth and jobs in my electorate of Durack if it remained in place for the long term?

Joe Hockey (North Sydney, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I thank the honourable member for her question, and recognise her electorate is quite large. In fact, it is the largest single electorate in the world—probably outside of a totalitarian state, I would suggest! But it is the largest electorate in the world. And of course there is a heavy reliance on everything from road transport to energy in her electorate.

The carbon tax is a handbrake on economic growth. There is no doubt about that. And before the election our political opponents recognised that, in a sense, and said that they were going to terminate the carbon tax. The problem is: they are doing everything they can to stop us from terminating the carbon tax. If we repeal the carbon tax, the size of the economy will be about 0.3 per cent higher than it otherwise would have been in 2020. It is actually a tax of $9 billion a year on the economy now, and in four weeks time, unless it is repealed by the Senate in the interim, the legislated carbon tax will go up another five per cent, to $25.40 a tonne. That is three times the size of the European carbon price—three times the size! And the Labor Party are defending that.

If the carbon tax remains in place, the cost to the economy is enormous. It would cost the Western Australian economy over $200 billion out to 2050 and it would cost the Australian economy over a trillion dollars out to the same point of time.

But it costs families; and if we abolish the carbon tax now we can immediately reduce the cost to the average household by $550 a year—$550 a year! According to Treasury, the expected impact of the tax on real wages rises to about 2.6 per cent by 2030, which is around $2,000 of average full-time wages.

Ultimately, if we get rid of the carbon tax we can strengthen the Australian economy. That is the bottom line. That is why we went to the last election saying to the Australian people, 'We want to abolish the carbon tax,' because we want to strengthen the Australian economy, we want to strengthen household budgets and we want to ensure that we can compete on a level playing field with the rest of the world.

The only problem is our political opponents, who said before the election that they wanted to terminate the carbon tax. Instead, they come into this place and do everything they can to prevent us from terminating the carbon tax. If the Labor Party does care about the economy, and if it does care about households, support us in getting rid of the carbon tax.