Australia repeals its controversial carbon tax

SYDNEY – Australia’s government repealed a much-maligned carbon tax on the nation’s worst greenhouse gas polluters today, ending years of contention over a measure that became political poison for the lawmakers who imposed it.

The Senate voted 39-32 to ax the $22.60 tax per metric ton of carbon dioxide that was introduced by the center-left Labor government in July 2012.

Prime Minister Tony Abbott’s conservative coalition government rose to power last year on the promise of getting rid of the tax, assuring voters that removing it would reduce household electricity bills. He plans to replace the measure with a taxpayer-financed fund to pay industry incentives to use cleaner energy.

Australia is one of the world’s worst greenhouse gas emitters per capita, largely because of its heavy reliance on the nation’s vast reserves of cheap coal for electricity.

The carbon tax, charged to about 350 of Australia’s biggest carbon polluters, was controversial from the start. Former Prime Minister Julia Gillard had initially vowed not to introduce a tax on carbon emissions. But after her Labor party was elected in 2010, she needed the support of the minor Greens party to form a government – and the Greens wanted a carbon tax. Gillard agreed, infuriating a public that viewed the measure’s imposition as a broken promise.

Labor’s popularity plummeted, particularly when consumers saw their power bills soar. In reality, the tax accounted for a relatively small portion of that increase, but many blamed it for the hike nonetheless.