The Fuel Tax Credits Scheme should be scrapped for the mining industry, not farmers, the Australia Institute has said in response to calls at today’s National Farmer Rally to keep the tax rebate for the agricultural industry.
Key Findings:
- The Fuel Tax Credits Scheme, also called the Diesel Fuel Rebate, is a subsidy for fossil fuel use valued at $10.2 billion in 2024-25. It works by refunding fuel tax paid by certain fuel users.
- The Scheme largely benefits coal and iron ore miners. The subsidy is estimated to be worth $4.8 billion to the mining industry in 2024-25, with $1.4 billion going to the coal industry alone.
- The agriculture industry is estimated to receive $1.3 billion in rebates in 2024-25.
- The Scheme has cost over $200 billion since 1990-91, adjusted for inflation.
- Organisations that explicitly call the Fuel Tax Credits Scheme a subsidy include the Organisation for Economic Cooperation and Development (OECD), the International Energy Agency (IEA), and the International Institute for Sustainable Development (IISD).
- The Fuel Tax Credits Scheme should be taken away for the mining industry, not farmers.
“Cutting out an exemption for farmers would only cost taxpayers $1.3 billion and still gather an extra $4.8 billion from the mining industry”, said Matt Grudnoff, Senior Economist at The Australia Institute.
“The rebate is a subsidy for fossil fuel use, which is driving the climate change that is impacting all of us, but farmers in particular.
“Subsidies such as the Fuel Tax Credits Scheme for the mining industry are not consistent with policy settings designed to phase out fossil fuels and limit the worst effects of climate change. They act as a disincentive for major fossil fuel users to decarbonise.
“Dropping the Fuel Tax Credits Scheme for the mining industry and keeping it for farmers is a win-win.”
The post Scrap fuel tax rebates for mining industry, not farmers appeared first on The Australia Institute.
Source link
