Businesses will still be liable to pay all their carbon liabilities up until June next year, when the impost could be scrapped.
The government released its draft legislation to repeal the carbon-pricing scheme on Tuesday and says it will be one of the first orders of business when parliament sits in November.
“Liable businesses and other entities must pay all carbon tax liabilities incurred up to June 30, 2014 through the carbon-pricing mechanism, excise or excise-equivalent customs duty, fuel tax credit adjustments or synthetic greenhouse gas levies,” the government says.
Part of the changes mean the government will not proceed with a second round of personal income tax cuts that were to commence in 2015/16.
“These income tax cuts were intended to compensate households for the transition to a floating carbon tax. They are no longer necessary, as the carbon tax will be repealed,” it says.
The Australian Competition and Consumer Commission (ACCC) will be given new powers to make sure businesses take account of the effect of the carbon tax repeal on prices.
Australian Retailers Association executive director Russell Zimmerman welcomed the scrutiny of the consumer watchdog.
“We are confident, as retail businesses find savings from the abolition of the carbon tax, that retailers will pass these savings on,” Mr Zimmerman said in a statement.
The government has forecast a saving of $550 per year for families as a result of the tax’s abolition.
Mr Zimmerman believes retail businesses could benefit from the first real boost in disposable income in a number of years.
The association has long campaigned against what it describes as a “business-damaging and economy-wrecking tax”.
“We are glad to see the government moving quickly to remove it,” he said.
Australian Industry Group chief Innes Willox said there needs to be a lot of careful work ahead with dismantling of the tax, particularly around the impacts of it and the replacement scheme.
“Ai Group will consult closely with our members over the proposed legislation and the inevitably complex transitional issues that will arise both in relation to the repeal and in relation to the transition to the new government’s approach to meeting the shared emissions reduction targets,” he said in a statement.
He anticipates there will need to be more consultation and refinement well past the November 4 cut-off date proposed on Tuesday.