Friday, July 18, 2008

Thoughts on Rudd's Petrol Excise Cut 'n Run

Considered thoughts on the green paper on emissions trading from Oikos. He has approximately the same take on the petrol excise offset as I have, though is more eloquent in expressing it.

There are two ways to look at this – from a practical perspective or from a principle perspective. Either way, my view is that cutting the petrol excise isn’t good but isn’t really all that bad either.

The practical implication of cutting excise and therefore neutralising the impact that the scheme has on the petrol price is that...

Oikos also prefers for the review of the excise cut after a three year period to be a permanent cut instead, — why defer uncertainty for three years. I agree, it also makes Labor a political target, by keeping open the notion among industry lobby groups they can keep getting exemptions. The opposition has already signalled they could break from bipartisanship.

I don't know what configuration of emissions trading scheme is best for Australia, but surely political courage is an enabling ingredient.

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