Construction equipment is one of the biggest and most complex commodities on the planet, and Australia has a particularly hard time exporting it.
With the supply chains of the world’s largest companies so intertwined, it’s no wonder that many Australian companies have long been reliant on foreign partners.
AUSTRALIA HAS A VERY WEAK ENVIRONMENT For the past few years, the Australian Government has been grappling with the economic impact of the carbon tax, which will see a tax on emissions from new and existing buildings.
The country’s construction sector has been hit hard by the tax.
The sector employs more than 40,000 people in Australia, and is responsible for the construction of the country’s major buildings, including the national football stadiums, the Commonwealth Parliament and the Sydney Opera House.
The Government is currently negotiating a package of tax breaks that will see many Australian firms receive a rebate.
But it’s not just a matter of the industry.
Construction companies rely on foreign firms for many of the same projects.
“I think it’s the Australian people’s responsibility to be able to export the products that they want to export and to compete against the rest of the global economy,” Construction Industry Association chairman Mike Hargreaves said.
When the carbon price was introduced, there was a lot of confusion about how the new levy would be applied.
Instead of the levy being levied at a flat rate, it would be subject to a cap.
For every $100,000 of carbon emitted in Australia that exceeds that cap, the levy would then be assessed at $10.
This means that any firm that makes more than $10 million a year would be hit hard.
The levy would also apply to any firm with less than $100 million in emissions.
Australia’s new carbon tax is scheduled to come into effect on January 1, 2018.
Under the existing system, construction companies were supposed to have to pay their fair share of the costs of the clean-up.
However, a review of the rules revealed that the Australian Construction Industry Union, which represents over 100,000 companies, argued that the Government should have set a maximum cap at $25 million.
Australian Government moves to overhaul the rules after review A number of reforms have been mooted to bring the levy in line with other nations, but it is unlikely that the new system will see it in place in time for the next major economic downturn.
There is also growing frustration among the Australian construction industry that foreign companies are able to operate at the highest level in the world.
Last month, the Federal Government announced plans to review and overhaul the existing tax system, which is already one of Australia’s most complicated.
Construction Industry Association chief executive, Mike Hoggart, says the changes will help Australia to better compete in the global construction market.
What can you do to support construction in Australia?
If you’re in Australia and would like to see the new carbon price implemented, you can sign up to our campaign and tell your MP to support a carbon levy.
This is a developing story.
More to come.