Last week, Australian Prime Minister Tony Abbott made good on his promise to repeal the country’s carbon tax. The move came after years of contentious political debate, which saw support of the tax slip away in the wake of the 2008 financial crash. Many politicians and business leaders made the argument that the tax made it too hard for Australian industries to compete with international competition.
This is a landmark moment in the history of Australia’s sustainability movement. The country, which is the second largest per capita carbon emitter among G20 nations (above the United States), will now undoubtedly struggle to meet its ambitious carbon reduction goals.
This news will also will have repercussions around the globe. It is a significant setback for the creation of an international carbon market, not least because many countries, including the US, have been watching Australia to see how well a tax and emissions trading scheme would work outside of Europe. This will clearly give leaders in other nations pause as they consider the political danger of pushing for a potentially unpopular tax.
Despite overall global progress with carbon tax and emissions trading schemes, this setback is not an isolated incident. Other countries including Japan and Canada have also taken steps backward in recent years.
The key question, and hope, is now that Australia’s businesses will continue to cut carbon emissions on their own. Some business leaders have indicated that they will strive to do so, however, with the legal driver gone only time will tell if this will be the case.