Carbon tax impact should be gradual: ACCC

31-08-2010
Carbon tax impact should be gradual: ACCC

 

The competition watchdog has told the business community it should not rush to raise consumer prices before it can evaluate the impact of the carbon tax on costs.
 
The Australian Competition and Consumer Commission (ACCC) doesn't expect widespread price increases when Labor's controversial tax starts on July 1 except in the retail electricity sector.
 
"This is something that is going to play out over some months rather than immediately," ACCC chairman Rod Sims said.
 
His deputy chair, Michael Schaper, insisted any price movement attributed to the carbon tax had to have a reasonable basis.
 
"Many businesses, however, may find that a more suitable approach may be to wait until after July 1, see what actual changes do flow though – from their supplier or utilities – and then make a decision about what movements in price they do," Dr Schaper said.
 
Mr Sims agreed that a wait-and-see approach could be best but noted it was up to individual businesses when they increased prices.
 
"(Just) make sure you've got enough information to know what's really going on rather than making it up and trying to take advantage of the situation," he said.
 
The watchdog on Monday launched a carbon price hotline and online claims form for people who think they're being ripped off.
 
It doesn't want consumers being duped into accepting a price increase that's not appropriate or buying products they otherwise wouldn't because of false claims.
 
The ACCC has received 200 complaints so far regarding retailers pre-emptively trying to lift the price of beer, taxis, pizza and even a swimming pool.
 
People have been told the carbon tax will force up electricity prices by hundreds of per cent in an attempt to make them buy solar panels.
 
Consumers also have been encouraged to buy a house now to "beat the carbon tax".
 
Others still have been told their gym membership would go up but if they bought additional years' coverage it wouldn't.
 
Most complaints have been resolved with warning letters but there are four "intensive investigations" ongoing.
 
The ACCC can ask businesses to substantiate their claims, write warning letters or issue infringement notices with fines of up to $66,000.
 
In extreme cases the watchdog can launch Federal Court proceedings with penalties of up to $1.1 million.
 
"(But) if small business are honest in their dealings with their customers they have nothing to fear from us," Mr Sims said.
 
The ACCC would not ping business people who had a genuine belief in what they were saying – so long as they weren't just parroting a political fear campaign, the chairman said.
 
"If you latch onto that to also say your price is going to go through the roof I think we should be concerned," he said.

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