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Carbon Taxation in Australia Essay


Several countries practice robust environmental management strategies. There is an urgent need to observe global environmental sustainability. Several protocols and treaties advocate for environmental conservation. This trend is presently notable within the global context. Generally, a higher level of economic development is vital. This is because it results into the advancement of the human life standards (Lye 2009, p. 11).

Sustainable development caters for the welfare of future generations. Therefore, economic performance is pertinent to environmental welfare. These include some of the considerations under the carbon tax principle in Australia. There is an eminent rise in the level of global carbon production. This contributes to the increased rate of global warming. There are diverse debates concerning the challenge of global warming.

Countries perceived as main perpetrators undergo a lot pressure. Most protocols advocate for the adoption of strategic approaches to ensure cutbacks in the rates of emission. Australia is an example of a nation with robust mitigation policies on carbon reduction. Several economic and political implications ensue from this noble policy. The policy influences most operations within important economic sectors.

These include human resource, industrial sectors, and most business organizations (Serret & Johnstone 2006, p. 21). There are notable economic and environmental impacts of the policy. These are observable within the local and global scenario. This paper discusses the economic justification of carbon tax in Australia. The paper draws potential theoretical frameworks from economic and environmental disciplines. The discussion focuses on the economic patterns within Australia.

Economic Justification of the Carbon Tax

There are several debates concerning the issue of carbon tax in Australia. The policy has notable impacts on environmental and other economic factors. Indicatively, the policy also depicts significant influences on the political arena. Observably, the carbon tax principle is yet to have potential impacts on the manufacturing industry within Australia (Garnaut & Garnaut 2011, p. 44).

There are evident arguments that the policy has severe negative influences on the life standards of most Australia citizens. Many firms are likely to lay off their workers.

Additionally, the firms are ambitious to minimize their investment and operational bases. These factors have important economic implications on the development of the entire country. Principally, the carbon tax is never justifiable on solitarily on economic grounds. There are several considerable reasons for this postulation. The Australian economy provides a typical example.

The case demonstrates the potential impacts of a carbon tax on various sectors. The environmental and social implications of the carbon tax are indisputable. There are notable organizational effects of the carbon tax within the economy (Suh 2008, p. 31). Due to this policy, nine of every ten corporations must experience detrimental impacts. Most corporate leaders reiterate this observation. This potentiated effect is due to the explicit and implicit tax stipulations outlined within the policy.

Therefore, there are eminent social impacts of the policy. About one million individuals engaged in different industrial and manufacturing activities presently undergo social and job-related pressures. This is due to the impacts of the carbon tax policy. The extra taxes imposed on important raw materials pose serious economic effects. Particularly, this relates to the efficient work processes within the affected sectors and industries.

There are important positive impacts of the carbon tax policy (Claus 2010, p. 55). Particularly, these are observable within environmental managment practices. The reduction of global warming remains crucial. Apart from this, there is a remarkable gain in the minimization of carbon output or release. These evident environmental impacts extend to the global scenario. There are countries that are more likely to gain from the operation of the carbon tax.

For instance, the developing or emerging nations are more likely to benefit from this concept. The principle of environmental sustainability remains important. Actually, it is the main overriding target behind the principle of carbon tax. There are indications that most vibrant Australian corporations are out of the international competitive market. Apart from this, the carbon tax has notable impacts on human resources.

Although it is possible to attain positive social effects from the carbon tax policy, there may be other eminent negative factors. These may include unemployment and increase in the level of social insecurity and threats. Other influences may emanate from political realms (Metz 2001, p. 78).

Theoretically, political, economic and environmental factors remain closely knit. Social impacts also interlink within these elements. Other than the projected economic benefits, the policy emphasizes on the concept of environmental sustenance and viability. The ability of other nations to adopt green practices in their development processes remains crucial. The Australian carbon tax provides a typical and model example for other budding states.

The political reactions about the carbon tax may lead to other significant occurrences. The political intrigues were mostly evident during the initial periods of establishment of the carbon tax. During the period, a lurking mood of civilian and political rebellion ensued in the entire country.

Political ideologies during the moment largely vested on the negative impacts of the carbon tax policy (Creedy & Sleeman 2006, p. 60). This state of events had widespread impacts on different realms of life. Generally, the carbon tax draws diverse reactions from different points. These also include important government agencies and other regulatory organizations.

The carbon tax policy influences the state of international relations in Australia. This situation is mostly notable within the BRIC states. There are present rivalries concerning the extent of carbon cutbacks and minimization percentages. Particularly, this is evident during most retreats and conventions on environmental sustainability.

There are different states within Australia. The federal government advocates for the adoption and practice of carbon tax policy. Notably, the government achieves this objective through diverse strategies. Political and ideological implications of the carbon tax exist between the different states. Interestingly, certain states do not advocate for the operation of the policy.

There are considerable arguments about the effects of nationalizing the policy (UNCTAD 2012, p. 41). Amidst all the indicated reactions from different domains, the objectives of the policy remain clear. The basic conclusion is that the carbon tax is not justified explicitly on economic grounds.


There are diverse debates on the impacts of carbon tax. Australia is a transformative nation. The adoption of the carbon tax principle depicts this positive achievement. It has struggled to enhance its sustainable development. The policy has both positive and detrimental impacts.

This is observable within different realms in the country. Notably, there are also international and diplomatic concerns on the carbon tax policy. The policy does not explicitly base on economic factors. Notably, other potential domains experience significant impacts from the carbon tax policy. These include environmental, political and the social aspects within Australia.

List of References

Claus, I 2010, Tax reform in open economies: international and country perspectives, Elgar, Cheltenham.

Creedy, J & Sleeman, C 2006, The distributional effects of indirect taxes: models and applications from New Zealand, Edward Elgar, Cheltenham, UK.

Garnaut, R & Garnaut, R 2011, The Garnaut review 2011: Australia in the global response to climate change, Cambridge University Press, Cambridge.

Lye, H 2009, Critical issues in environmental taxation, Oxford University Press, Oxford.

Metz, B 2001, Climate change 2001: mitigation, Cambridge University Press, Cambridge.

Serret, Y & Johnstone, N 2006, The distributional effects of environmental policy, Edward Elgar, Cheltenham, UK.

Suh, S 2008, Handbook on input-output economics for industrial ecology, Springer, Dordrecht; London.

UNCTAD, (United Nations Conference on Trade and Development) 2010, Trade and environment review, 2009/2010 promoting poles of clean growth to foster the transition to a more sustainable economy, United Nations, New York, NY.

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IvyPanda. 2019. "Carbon Taxation in Australia." December 15, 2019. https://ivypanda.com/essays/carbon-tax-essay/.


IvyPanda. (2019) 'Carbon Taxation in Australia'. 15 December.

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