The SAIT submission on the Carbon Tax Phase II Discussion Paper supports several proposals, including revenue neutrality in electricity pricing, incentive-based allowances, and continued relief for hard-to-abate sectors. However, it raises concerns about steep carbon tax increases, potential negative impacts on investment, limited availability of carbon offsets, and the removal of trade exposure allowances for fuel combustion. SAIT also critiques the linking of benchmark allowances to mitigation plan approvals and suggests extending existing incentives like Section 12L, introducing a new investment-linked carbon tax allowance, and ensuring the market is ready for offset expansion. The submission calls for a more balanced, gradual approach to ensure policy effectiveness without undermining industrial competitiveness.
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