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Increasing environmental levies to lower pollution and help solve government funding issues:researcher

Xinhua, November 13, 2015 Adjust font size:

Increases to Australia's environmental levies would help solve the regional states' revenue issues, while also helping the environment to a greater outcome through lower pollution, an eminent Australian sustainability researcher believes.

Australia's commonwealth and state governments are currently exploring and debating improvements into the national tax system, driven by the suggestion to raise the Australia's sales tax (GST) that's collected by federal authorities but distributed to the regional governments.

"The government's goal is to create a better tax system that removes the impediments that are holding Australians back and enables them to earn more from a growing economy and take home more as a result of more efficient taxes," Australian Treasurer Scott Morrison told Xinhua in a statement on Friday.

The debate surrounding the GST was sparked by New South Wales Premier Mike Baird mid year when he suggested it be raised from its current 10 percent, to 15 percent of all sales, to cover funding gaps initiated by former treasurer Joe Hockey's 80 billion dollar cut to state funds in the 2014 federal budget.

However government authorities should be looking to raise environmental levies rather than the GST, giving budgetary benefits but also increased environmental protection, Professor Stuart White, director of the Institute for Sustainability at the University of Technology, Sydney told Xinhua.

Though Australia has agreed to international conventions on pollutant control, it's the state and territory governments that have primary responsibility for the effective management of waste, using a combination of instruments through extensive regulations, pricing and persuasion, depending on the type of pollutant.

The commonwealth government's role relates to transboundary movements of hazardous chemicals and wastes, ensuring they are managed in an environmentally sound manner.

Best practice environmental controls are currently in New South Wales (NSW) where strong planning policies force residents to reduce their environmental impact while business use a 'polluter pays' principle through load based licensing systems.

"If you pay by or regulate on concentration, then there's an incentive for people to push more water in the system to dilute for the same load," White said, using fats and oils in water pollution as an example.

"You're better off to charge on the kilograms or tons of fats and oils rather than how much water [they are] dissolved into," White said.

The funds generated from these levies are then used support business to "do the right thing", such as help establish environmental management plans or use the funds for site remediation programs.

Though Australia's landfill and water resources levies are a small proportion of expenditure, White argues if levies were cumulatively increased across the board, including on energy and carbon emissions, it would raise enough to make a difference to state and territory budgets.

"You could put [the increased funds] straight into consolidated revenue or you could use it for a special purpose," White said.

"Britain for example has a waste levy that supports their pension scheme."

Australia has strong history of hypothecation, or distributing particular tax revenue for a specific dedicated purpose, such as the internationally acclaimed gun buy-back program or the levy imposed to help victims of cyclone Yasi in 2011.

"There's really strong evidence that Australian citizens strongly support taxes where it's clear where the money is going," White said.

White said it would require national reforms for such measures to happen due to mutual recognition laws which requires Australia's state governments to have uniform tariffs, such as fuel excise or a potential tax on Carbon.

However White is pessimistic the Australian government would implement a Carbon tax after the current government's vocal campaign against the measure during the 2013 elections.

"The current coalition government couldn't entertain something that resembles a carbon tax directly because of the experience they've just been through, but it doesn't mean we shouldn't be talking about it," White said.

Australia's government has committed itself to reducing its greenhouse gas emission to five percent below 2000 levels by 2020 though direct action measures, a renewable energy target and energy efficiency standards.

"The centrepiece of the Australian government's approach is the 2.55 billion Australian dollar Emissions Reduction Fund."

"The fund provides positive incentives for emissions reduction activities across the Australian economy and encourages Australian businesses to adopt smarter practices to cut the amount of greenhouse gases they create."

Climate advocates however claim the policy is out of step with global norms and doesn't target the core source of pollution, such as fuel emissions.

Climate Council chief executive Amanda McKenzie says accelerating the retire of Australia's aging coal fired power stations, introducing a carbon price as well as spurring renewable investment are just some of the mechanisms authorities should implement.

"I went to a solar array in the middle of the Chinese desert that was 12 kilometres by 12 kilometres providing 500 megawatts [of electricity]," McKenzie said.

"That's the sort of thing we could easily do in Australia.

"It is just that lack of vision and imagination at this point." Enditem