A tax on carbon emissions that targets an estimated 500 Australian businesses goes into effect July 1 and some processors are considering temporary closures to lower emission levels and avoid the $23-per-metric ton levy.
Teys Australia is one of four processors — including JBS Australia, Bindaree and Kilcoy — found to be exceeding the threshold of 25,000 metric tons of carbon emissions.
The company reportedly is considering shutting down one of its plants for an undisclosed number of weeks in an attempt to move the needle below the threshold.
Teys would be liable for at least $600,000 in taxes per year based on its current output.
Some processors could switch to more efficient power generating systems in order to reduce emissions now generated by the use of coal.
Smaller processors are also taking steps to address their concerns about the economic impact of the carbon tax.
A group of chicken farmers reportedly met with Australian officials to point out that they cannot pass along the higher costs to customers because they are locked into contracts to suppliers that cap their fees to about 76 cents per bird.
The Australian government is making grants available to companies that compete with offshore companies that may not be taxed for carbon emissions.
One of the six grant categories is targeting small businesses with less than $2 million in annual sales, while larger companies like steel, aluminum and cement producers may be eligible for a total of $9.5 billion in free permits to offset tax costs.
Source: meatingplace
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