5. Carbon Pricing

 5.1. Carbon Tax

• No revised Bill or regulations have been published.
• Meeting with the Director General (DG) at National Treasury to discuss the carbon tax to be confirmed.

The revised Bill has not been published yet. The required regulations are still outstanding; Business remains resolute that the Bill and the required regulations must be published together.

It is understood that sector discussion with National Treasury (NT) regarding the Z-factor for each sector are still underway and that these should be concluded early-September 2017.

The updated schedules for the Trade-Exposure allowance have been circulated for review, once this work is complete, the legal instrument will be drafted. Once comments have been received and reviewed there will be a workshop with NT to conclude this work.

BUSA is arranging a meeting with the Director General at NT to give Business’ view of the carbon tax, the date is yet to be confirmed. The agenda/discussion items for this meeting will include:

• Business does not believe that a carbon tax is the best instrument in the current economy
• Without the GHG reporting system in place, the tax cannot be implemented effectively
• There must be alignment between the carbon budgets and the carbon tax for post-2020; a government policy statement on this is needed now
• Given it is unlikely that the tax will be implementable by 1 January 2018, it could only be in place for two years for the first phase – why would NT want to implement a tax for such a short time?
• Clarity on the timing for finalisation of regulations on Trade Exposure, the Z-factor and Offsets
• Why a carbon tax should apply to the energy sector at all, given the carbon constraints included in the IRP to achieve a decrease in GHG emissions from this sector