Australian ships on the domestic ship register will be further disadvantaged

2011.6.20-MV-SUEZ.jpgThe Maritime Union of Australia has welcomed the long-awaited carbon price package, which provides certainty to workers,their families and industry as the nation shifts towards a low-carbon economy.

The package for a fixed carbon price of $23 a tonne, to begin in mid-2012, begins the process for taking real action on climate change.

The MUA supports the carbon package as a balanced approach that starts the process of tackling climate change and moving the economy towards one that reduces pollution and relies less on carbon-emitting technologies, MUA National Secretary Paddy Crumlin said.

In addition, the compensation package ensures that many of our members and their families, as well as retired members who are now pensioners, will not be penalised by the changes.

The package includes a Jobs and Competitiveness Program for emissions-intensive trade-exposed industries and special measures for industries such as steel, gassy coal mining, and electricity.

We expect little change to the export of coal, and the maintenance of a strong steel industry in Australia which is good news for our members, Mr Crumlin said.

We also welcome the creation of the Clean Energy Finance Corporation to help drive investment in clean technologies -some of which could involve shipping through the transport of alternative fuels if that industry expands.

The MUA, however, remains concerned by some components of the package, namely the impact on industries that involve a shipping/ports component in their supply chain.

The domestic shipping industry currently pays no excise on fuel, as it is offset under the fuel tax credits scheme. The carbon package will reduce the fuel tax credit entitlement.

This will add around 6 cents per litre to the cost of bunker fuel from 1 July 2012, in contrast to the phase-out of the tax credit for heavy vehicles, which is scheduled to commence in 2014.

The MUA acknowledges that the significant emissions from transport need to be tackled as part of the carbon package, Mr Crumlin said.

The MUA is expecting the same treatment of foreign shipping licensed to participate in the domestic freight market as was included in the former Carbon Pollution Reduction Scheme (CPRS).

Under the CPRS, the Government agreed to put in place measures to ensure that allcargo that carries domestic cargo faces an equivalent carbon price.

Also, the Government has not addressed the inequity in the tax system whereby foreign ships - which will continue to be permitted to operate in the coastal trade under Temporary Licenses and or Emergency Permits - do not pay GST or Customs duty on bunker fuel if they are continuing on an international voyage.

This means that Australian ships on the domestic ship register operating in the coastal trade will be further disadvantaged relative to foreign ships operating in the coastal trade, Mr Crumlin said.

Source: MUA