The carbon tax and your business

energy bill

There is still a lot of confusion in the community about the impact of the carbon tax on businesses. We recently caught up with The Minister for Small Business, The Hon Brendan O’Connor MP to get some of the latest information on this topic.

The most likely impact of the carbon tax on many SMEs will be through electricity prices, what will be the likely impact of this on electricity prices?

The price paid for electricity by a typical small business is expected to rise by around 10 per cent and for most businesses electricity makes up 2 per cent or less of costs. In other words, for a small business with a total of $100,000 of expenses per year, their electricity bill is expected to only rise by around $4 per week because of carbon pricing. For further information on your electricity bill, click here.

It’s important to remember that general significant increases in electricity prices have been primarily driven by investment in network infrastructure, the majority of which is owned by state governments. The carbon price has a modest additional impact. You can find information on practical ways to reduce the energy bill for your business at Clean Energy Future and the Energy Efficiency Exchange.

How do you expect most small business to adjust prices because of the carbon tax?

It is expected that in most cases you will pass on increases in energy costs to your customers. That is why the Government has put more money in the pocket of households, so that customers will still be able to comfortably support businesses. The tripling of the tax‐free threshold – from $6,000 to $18,200 – will also directly benefit around 1.4 million small business owners who are sole traders or hold an interest in a partnership or operate through a trust.

What obligations do small businesses have regarding the impact of the carbon price?

No new obligations are involved, you simply need to have confidence in any claims you make about the cause of any price rises. For further information see The Australian Competition and Consumer Commission (ACCC) has put out guidance to help you understand your obligations in relation to claims about the impact of the carbon price and also how to challenge misleading claims that may be made by suppliers.

There is also specialised information regarding the impact of the Clean Energy Future Plan on the waste sector and certain refrigerants that are particularly damaging for the environment at Clean Energy Future.

Is there anything else that small business should be aware of?

The small business instant asset write‐off threshold has now been increased to $6,500.  And there’s no limit to the number of items that can be written off in a financial year, making it easier for you to invest in more energy efficient equipment if you choose. You can find out more at

The Government has also funded a number of business groups to roll out targeted energy efficiency information, which will help you manage your electricity costs. Further information and a list of successful applicants for Round 1 of the program can be found at

More information on the Minister for Small Business can be found here or for general enquiries, email