| 13.07,12. 01:21 AM |
Tax on a tax with GST inflating carbon costs
July 13, 2012
FAMILIES and businesses are facing a surprise "tax on a tax" as the GST is applied on top of the carbon tax to power bills, appliance repairs and other everyday costs.
Baffled consumers are questioning inflated repair bills received since July 1 as the carbon tax combines with the GST to add hundreds of dollars to invoice costs.
And some companies are grappling with how to apply the 10 per cent GST to the carbon tax amid fears the Australian Competition and Consumer Commission will crackdown on illegal pricing.
One of the nation's largest waste disposal firms J.J. Richards, was threatened with fines of up to $1.1 million after telling customers the carbon tax will cost "$25.30/tonne including GST".
A spokesman for Climate Change Minister Greg Combet said the claim -- outlined in an "Important Notice to Our Customers" issued by J.J Richards -- was "wrong and the government will refer it to the ACCC". "Any businesses jacking up their prices and falsely blaming the carbon price could be liable for fines of up to $1.1 million," Mr Combet's spokesman said.
Airconditioning firms, data contractors and waste firms have all begun applying the GST on top of the carbon tax, according to invoices that have been obtained by The Daily Telegraph.
NSW electricity companies also confirmed the 10 per cent GST would be applied to power bills, after the carbon tax had been added to the bill.
Origin Energy confirmed that it was normal practice. As the carbon price was an input cost to the supply of electricity to customers, it is added into the cost of supply.
The GST, as is mandated, must apply to the total retail cost of a good or service. But companies are cautious about publicising this, as customers are already angry at rising costs due to the carbon tax.
Origin remits GST on its taxable supply of energy to customers, a spokesperson for the company said.
In another case, the cost of repairing a household air-conditioner was inflated by several hundred dollars, because the price of refrigerant gas had soared by 90 per cent.
The GST was then added to the overall bill.
Margaret Coleman said she was surprised to receive such a hike for the repair to her Queensland unit.
"Because the price has gone up, the GST has gone up as well -- so we pay more tax than the Labor government was telling us," she said.
The repairman told customers he was forced to increase his prices "due to the carbon tax".
A Sydney firm was hit with a $43.20 "carbon tax supplement" for their monthly data bill, with the GST applied on top of this cost.