Carbon revenue 'chance for tax cuts'

By ELLEN READ

Carbon tax revenue should be used to reduce company and personal income tax rates, says a report released yesterday at the Sustainable Business conference.

The Government plans to introduce carbon emissions charges by 2008 to meet obligations under the Kyoto Protocol.

The charges and estimated revenue are not yet known but at a speculative $25 per tonne of emissions the study says the Government could reduce GST by 2 percentage points, offer a 6 percentage point reduction in company tax or take 3 percentage points off the bottom tax rate of 19.5 per cent on income up to $38,000. Alternatively, all tax rates (personal income and company) could be lowered by 1.5 percentage points.

The report, written by Ecologic Foundation's Jim Sinner and Guy Salmon, for the New Zealand Business Council for Sustainable Development, argues that economic incentives are the key to addressing infrastructure and environmental problems.

Charging businesses for excessive waste and emissions and channelling that revenue back into tax cuts and infrastructure is the best way to tackle problems like resource shortages, pollution and road congestion.

Other suggestions include:

* The creation of a tradeable credit for sustainable resource recovery. A transferable resource recovery certificate could be used to offset waste generation. Businesses could be required to either buy or generate a set number of certificates for every hundred tonnes of waste they dispose of.

* A road-pricing system for the Auckland region with different prices for different sections and times.

* Tradeable emissions allowances for air pollution.

The conference, which ends today, aimed to show how being sustainable made good business sense.

Winners of the 2003 Sustainable Business Awards announced last night:

Large Business: Winner - Carter Holt Harvey-Tasman.

Second - Untouched World. Third - BP Oil New Zealand.

Medium Business: Winner - Urgent Couriers. Second - Simon Mortlock Partners. Third - Waimangu Volcanic Valley.

Small Business: Winner - Omaha Blueberries. Second - New Zealand Educational Tours.

NZ Business Council for Sustainable Development