Minister defends carbon tax, weighs in on bank loans

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Minister defends carbon tax, weighs in on bank loans

Electricity prices will rise by 0.2% as a result of carbon tax, says the Minister for Small Business Brendan O’Connor.

The Minister for small business has again reiterated government claims that the cost of electricity for small business would only rise by 0.2%.

Speaking last night to more than 11,000 small business people via a seminar broadcast online, the Minister Brendan O’Connor said the  impact on electricity prices for small business would be “negligible”.

“Treasury has estimated that the proportion of overall costs spent on energy by small business is 2%,” Minister O’Connor said. “And we say that there’s a 10% increase on the 2%. So we say in relation to energy, for example there’s a 0.2% cost to small business.”

These figures have been previously criticised by the Coalition.

While the government has promised small business they will not be hit by any direct tax or red tape as a result of the carbon tax, question continue over the real impact the tax will have.

Surveys like this one show that there is particular concern that small businesses in the supply chain to big businesses targeted by the tax, will find the costs being passed down.

Earlier this year the Opposition seized on reports that Westfield lease agreements included a clause that was interpreted as a move to recover costs resulting from the tax.

Negative perception of the tax is also being fueled by sites like this one, a carbon tax calculator, which is running slogans like “A carbon tax will hit small businesses and households”.

Minister O’Connor refuted such criticism. “I am confident that once people have lived the experience, of the change from the first of July, realised the sky’s not going to fall in, the costs that were being suggested are not going to be imposed upon them, and the regulations and all sort of other scare campaigns that have been waged are not true, I think people will realise it’s business as usual.”

The Minister also weighed into the issue of bank loans for small businesses, saying the issue came up “time and time again”. He said he has asked the banks to think about “creative ways” to get around impediments.

“There’s no doubt there is still a greater gap for example, between the official cash rate and the business loan rate, since the GFC. That worries me, " Minister O'Connor said. "The access to credit does concern me.”

 

 

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