The ACCC has warned that businesses that supply regulated goods will be required to pass through all cost savings attributable to the carbon tax repeal.

Carbon tax repeal: Businesses must on pass on cost savings warns ACCC

23 July 2014

The Australian Competition and Consumer Commission (ACCC) says it has new powers to take action against businesses that supply regulated goods which fail to pass on all cost savings attributable to the carbon tax repeal.

It said businesses which supply regulated goods – electricity, natural gas, synthetic greenhouse gases (typically refrigerant gases) or synthetic greenhouse gas equipment (such as refrigerators and air-conditioners) will be required to pass through all of the cost savings, direct and indirect, that are attributable to the carbon tax repeal.

“When the new law takes effect and the carbon tax is repealed, these businesses must pass through all cost savings from the carbon tax repeal,” ACCC chairman Rod Sims said.

“If they fail to do so, the ACCC will take enforcement action against them and seek serious penalties from the courts.”

According to the ACCC, a supplier of regulated goods that fails to pass through all cost savings attributable to the carbon tax repeal will breach the carbon tax price reduction obligation and may face court-imposed penalties of up to $1.1 million per contravention for corporations or $220,000 per contravention for an individual.

The court can also issue injunctions or declarations, make compensation orders or orders setting the maximum price of regulated goods or requiring the supplier to pay refunds to consumers.

“The ACCC will be keeping a close eye on prices to make sure that all cost savings go to consumers,” Sims said.