JUST GOOD BUSINESS NEWS: TAX OR TRADE?

Victorian governor David de Kretser is the latest to wade into the debate whether carbon taxes are more effective means of reducing greenhouse gas than Australia’s planned emissions trading scheme.
Speaking at an environmental sustainability conference at Monash University last month, he said tax would increase the price of goods using energy from high emitting power stations and help drive high-polluting developing countries (those now manufacturing most of the world’s goods) towards renewable energy.
The tax option has also been raised again in New Zealand with submitters to the select committee hearing on New Zealand’s stalled ETS scheme advocating it as simpler and legitimate intervention to drive economic behaviour change. An instrument rejected here in 2005 is perhaps looking more favourable given the current volatility in world markets generally, let alone the complex carbon trading environment. However it seems governments on both sides of the Tasman are now committed to some form of emissions trading.

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