'Sky won't fall in' when carbon tax is introduced: Labor

20/06/2012 - Federal Opposition Leader Tony Abbott is planning a fortnight-long national tour on the carbon tax after its introduction in less than three weeks. Colin Brinsden

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While the Labor government says "the sky won't fall in" when the $23 per tonne impost on Australia's biggest polluters is introduced on July 1, the coalition maintains it will push up electricity prices and living costs and hurt the economy.

Abbott told a joint party room meeting in Canberra on Tuesday he and some of his shadow ministers would embark on the tour in the first two weeks of next month.

The plan comes as the government ramps up its campaign to reassure voters the impact will be minimal and highlights its multi-million dollar compensation package of tax breaks and pension increases.

Acting Prime Minister Wayne Swan told parliament the carbon price initiative would lift consumer prices by less than one cent in the dollar.

But Abbott was "running a scare campaign by exaggerating every possible price increase and then multiplying by 10".

During a caucus meeting on Tuesday, Labor MPs were been told to tell their constituents that upcoming rises in electricity prices were not simply because of the carbon tax.

"Don't fall for the simplistic assertion this is about carbon pricing," he told MPs.

Swan said voters were starting to appreciate electricity prices rises were not simply related to the tax, because state generators had already been raising prices to pay for network upgrades.

NSW and South Australian residents are facing 18 per cent rises in their power bills from July 1.

Swan said apart from the compensation payments that have already gone out, 1.3 million families would start receiving a so-called school kids bonus from Wednesday.

Under the scheme, families receiving their Family Tax Benefit Part A fortnightly will receive $409 for each child in primary school and $818 for each child in high school.

In an address to the Committee for Economic Development of Australia, Abbott reaffirmed that a coalition government would scrap the carbon tax, and would not hesitate to call a double dissolution election if thwarted in the Senate.

"(But) I think it's highly unlikely that the Labor Party which loses an election, which is a referendum on the carbon tax, would persist in supporting this policy," he told the gathering in Canberra.

"Rational politicians do not commit suicide twice."

Abbott also said a coalition government would do a better job of cutting business red tape than the former Howard coalition government and well as cutting spending and taxes.

"I think we can and will do a better job than the Howard government was able to do between 1996 and 2007," he said.

The opposition is so far promising to reduce red tape costs by at least $1 billion a year.

Source: AAP

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