Household Impact & Compensation
The carbon pricing scheme will impose costs on big polluters, which will result in higher end prices for certain products. Treasury estimates that an average family will pay $9.90 more per week in the first year of the scheme’s introduction.
There are two measures that have been introduced as part of the package to soften the impact of these price rises. Firstly, the tax-free threshold will be more than tripled from $6,000 to $18,200, exempting 1 million people from the need to pay income tax or file a tax return. People earning less than $80,000 per year will also receive a tax cut, which for most will equal approximately $300 per year. Secondly, generous assistance will also be provided to households through welfare payments. Pensioners and self-funded retirees, as well as family payment recipients and other allowance recipients will see their payments increase.
Millions of households, particularly pensioners and low income households, will be better off.
The level of compensation will see the vast majority of people be fully compensated for the price increases, and many will actually end up better off. Plus, if you can reduce your dependence on carbon-intensive products you could end up even better off still.
For more information about your specific entitlements, please try the Household compensation calculator.
This post is based on a briefing paper from the Environment Defenders Office Victoria